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Book_h_5 



63d Congress, j SENATE. ( Document 

1st Session. \ ) No. 163. 



TAXING GOVERNMENT PROPERTY. 




MESSAGE 

FROM THE 

PRESIDENT OF THE UNITED STATES, 

TRANSMITTING, 

IN RESPONSE TO A SEN:ITE RESOLUTION OF FEBRUARY 18 1913, 
A COMMUNICATION FROM THE SECRETARY OF STATE, TOGETHER 
WITH INFORM .xTION REL -^TINGTO THE TAXING OF GOVERNMENT 
PROPERTY IN THE SEVERAL CAPITALS OF THE LEADING COUN- 
TRIES OF THE WORLD. 



August 13, 1913. — Ordered to lie on the table and to be printed. 



To the Senate: 

I transmit herewith ^ report from the Secretary of State, sub-r 
mitting copies of the dispatches received from the diplomatic officers 
of the United States, to whom were addressed instructions prepared 
with a view to carry out the resolution of the Senate of the United 
States, dated February 18 last, requesting the Secretary of State, 
' ' through the diplomatic and consular officers of the Government, to 
ascertain the system of taxing Government property in the several 
capitals of the leading countries of the world, a full and complete 
report on the subject to be transmitted to the Senate at the earliest 
practicable day.^' 

WooDROw Wilson. 

The White House, 

Washington, August 13, 1913. 



The President : 

The undersigned, the Secretary of State, has the honor, in reply 
to the resolution of the Senate of the United States dated February 
18, 1913, requesting the Department of State 'through the diplo- 
matic and consular officers of the Government to ascertain the sys- 
tem of taxing Government property in the several capitals of the 
leading countries of the world, a full and complete report on the 
subject to be transmitted to the Senate at the earliest practicable 



TAXING GOVERNMENT PROPERTY. 



day," to say that a circular instruction was prepared calling on the 
diplomatic officers at the capitals of the leading countries of the 
world to report in compHance with the terms of the resolution. 

The reports from those officers, so far as they have been received, 
are submitted herewith. 

KespectfuUy submitted. 

^ W. J. Bryan. 

Department of State, 

Washington, August 9, 1913. 



St. Petersburg, March I4, 1913. 
The Secretary of State, 

^Yashington. 
Sir: In answer to the department's circular instruction of Feb- 
ruary 20 last, directing me to report upon the system of taxing Gov- 
ernment property in St. Petersburg, I have the honor to inform you 
that the property of the Government here is not taxed by the Crown 
and is only taxed by the municipality when it derives an mcome by 
renting to outside parties. In the latter case the same system of 
taxation is employed as upon private property. 

I have, etc., Curtis Guild. 

Lisbon, March 29, 1913. 
The Secretary of State, 

^Vashington. 
Sir: Referring to your circular instruction of February 20, 1913, 
I have the honor to inform you that I am in receipt to-day of a note 
from the minister for foreign affairs in which he states that ' ' in Portu- 
gal Government property does not bear the burden of any tax or 
contribution." 

I have, etc., Cyrus E. Woods. 

Brussels, Afril 1, 1913. 
The Secretary of State, 

Washington. 
Sir: In compliance with the department's circular instruction of 
February 20 last, I have the honor to inclose a copy of a report, pre- 
pared at my direction, regarding the system regulating the taxation 
of the property of the Government of Belgium m Brussels. 
I have, etc., 

Theodore Marburg. 



[Translation.] 

In response to your request for a report on the system regulating 
the taxation of the properties of the Government in Brussels, I have 
the honor to advise you as foUows: 

The properties of the State are of two classes, viz, public property, 
properly speaking — that is, belonging to the State and used for the 
general welfare, such as roads, canals, churches, museums, the offices 
of the ministries, the royal palaces, the libraries, etc. — and private 

0. OF D. 

SEP Vd ]m 



^ y\^ TAXING GOVEKNMENT PROPERTY. 3 

property, such as real estate, vacant and without owners, and estates 
m escheat. 

On the other hand, the contributions, taxes, and impositions are 
subdivided — 

(a) In land taxes covering the ground and what is built thereon. 

(b) In personal taxes, which cover the renting value of the build- 
ings, the doors and windows, and the value ol the furniture in the 
said buildings, without mentioning the other bases, servants, horses, 
etc., which are outside of the question under consideration at present. 
The ground taxes, as well as the personal taxes, are levied — that is to 
say, collected — by the collectors of the State, but their product is 
divided between the State, the Province, and the commune. 

(c) The communes have also the right to levy taxes and contribu- 
tions on properties existing in the commune, as well as on the per- 
sons who live therein, and the trades, professions,, and businesses 
carried on therein. The commune has the right to levy additional 
taxes, which are outside of the question under consideration. 

(a) ground taxes. 

The law of the 3d Frimaire, year 7, article 105, and the decree of 
August 11, 1808, establish that the following improved properties are 
not subject to the ground tax: 

(a) L'nproductive national properties, such as the palaces, castles, 
and royal buildings, the Palace of the Senate, the Chamber of repre- 
sentatives, the houses used for the residences of the ministers, the 
public administrations, and their offices. 

(b) The churches and temples consecrated to public worship. 

(c) The houses of the archbishops and bishops, seminaries (the 
establishments known in Belgium as 'kittle seminaries" are not 
exempt from the land-tax decree of the Court of Cassation, Dec. 21, 
1865), and rectories (vicarages are not exempt from the land tax). 

(d) Buildings occupied by the courts and tribunals. 

(e) The military school, the State universities, the atheneums, col- 
leges, schools (private schools which are not established under the 
direction and the inspection of the public authority, even though 
they are established in a property belongmg to a charitable institu- 
tion or any other public establishment (Cassation, Jan. 23, 1882); 
a royal order of September 17, 1818, exempts from the land tax the 
schools belonging to charitable establishments or where an entirely 
free mstruction is given), libraries, museums, botanical gardens belong- 
ing to the State, to the Provinces, and to the communes. 

(f) The buildings occupied b}^ the administrations of the provincial 
and communal governments. 

(g) The asylums are subject to the ground tax if the buildings belong 
to a private party who gratuitously concedes the occupation thereof 
to the administration of asylums. (Cassation, Nov. 11, 1867.) The 
poorhouses, the prisons, and the houses of detention. (The pawn- 
shops remain subject to the ground tax. Cassation, Jan. 29, 1868.) 

(h) The fortifications, arsenals, magazines, barracks, and other 
military establishments. 

(i) The gunpowder factories and others for the account of the 
Government; in short, all the unproductive buildings devoted to the 
public service, except in cases where they belong to private parties. 



4 TAXING GOVERNMENT PROPEBTY. 

A law of the Nineteenth Ventose, year 9, also exempts the national 
woods and forests from taxation. 

The preceding therefore establishes that those unproductive na- 
tional properties serving for the public good do not pay any tax or 
rent whatsoever. 

The productive national properties declared alienable; that is to 
say, those which in principle pass from the public property to the pri- 
vate property of the State pay ground taxes just as do private prop- 
erties of the same nature. 

(b) persoxal taxes. 

The greater part of the buildings of the State property also escape 
the payment of the personal tax, viz: 

(1) The churches serving for worship. (Ministerial circular of 
June 15, 1855.) 

(2) Public educational or charitable establishments; however, parts 
of such estabhshments occupied by persons who pay for their main- 
tenance are not exempt. (Cncular of June 15, 1855.) 

(3) Lastly, all the edifices devoted to the service of the State, the 
Provinces, the cities, or the communes, such as markets, custom- 
houses, barracks, offices serving for the administration, etc.; however, 
parts of these edifices which may be inhabited and devoted to other 
uses than those of the State are subject to the tax. (Law of June 28, 
1822, art. 4.) 

The furniture contained by the buildings, exempt as stated above 
from the personal tax, escapes also the furniture tax on condition that 
it be devoted to the uses of the administration. 

(C) COMMUNAL TAXES. 

The taxes assessed by the commimes are not, in principle, valid 
except when they are approved by the permanent deputation and 
by the King. It therefore appears easy for these powers to refuse 
to approve a communal tax if the latter affects the properties of the 
State; but the principle of the public properties is opposed, in con- 
formity with w^hat has been said above, to the taxation of such prop- 
erties. They therefore escape the taxes levied by the commune, as 
they escape the ground taxes and the personal taxes, on the triple 
condition of being (a) national properties, (b) unproductive, and (c) 
devoted to a purpose of general welfare, which is what a law of 
December 24, 1906, stipulates, confirming that of 1808. 

Nevertheless there are certain communal taxes which are not in 
reality impositions, but w^hicli constitute the reimbursement of ex- 
penditures made by the commune in the interest of all the propri- 
etors of neighboring real estate, such, for example, as a sidewalk or 
sewer tax. These taxes are really the equivalent of the payment of 
the expenses undertaken by the commune to build the sewer and 
pave the street. In spite of this special character the State refuses 
on principle to pay these taxes, and the commune, having no legal 
means of obliging the State to pay, does not bring suit for their 
recovery. 



TAXING GOVERNMENT PROPERTY. 5 

Rio de Janeiro, April 7, 1913. 
The Secretary of State, 

WasMngton. 
Sir: In reference to the Senate resolution of the 18th of February 
last, the text of which was communicated to tlie embassy in a printed 
circular instruction of the 20th of last February, entitled '^ Taxation 
of Government property," I have the honor of reporting as follows: 

The Brazilian secretary of finance has assured me that the Govern- 
ment of Brazil levies no tax whatsoever upon Government property, 
and that it collects no transfer tax when private property is acquired 
by the Government. When a private party, however, purchases 
property from the Government a transfer tax must be paid. 
I have, etc., 

Edwin V. Morgan. 



American Legation, 
Santiago, Chile, April 12, 1913. 
The Secretary of State, 

WasMngton. 
Sir: I have the honor to acknowledge receipt of the department's 
circular instruction entitled '' Taxation of Government propert}^/' 
dated February 20 last, and to state in reply that I have been in- 
formed by the minister of foreign affairs that Government property 
in Chile pays neither state nor municipal taxes. 
I have, etc., 

Henry P. Fletcher. 



Legation of the United States of America, 

TJie Hague, Netherlands, Ajml 15, 1913. 
The Secretary of State, 

Washington. 
Sir: Referring to the department's circular instruction, dated 
Februar}^ 20, 1913, entitled "Taxation of Government property," I 
have the honor to report that on receipt thereof a note was addressed 
to the minister for foreign affair.-, asking for the desired inforination, 
and that a reply thereto has just been received from the foreign 
office, stating that throughout the Netherlands property of the 
State, destined exclusively for the public service, is exempt from 
land tax, and as to the personal tax, this is not required either, in so 
far as the estate is concerned in the service of the realm. 
I have, etc., 

Lloyd Bryce, American Minister. 



Embassy of the United States of America, 

Tolcyo, April 16, 1913. 
The Secretary of State, 

Washington. 
Sir: In reply to the department's circular instruction of February 
20, 1913, I have the honor to report, for the information of the 
Senate, that Government property in this capital is not taxed. 
I have, etc., 

A. Bailly-Blanchard. 



6 taxing government property. 

American Embassy, 

Rome, Italy, April 17, 1913. 
The Secretary of State, 

Washington. 

Sir: Referring to the department's printed instruction of February 
20 last in regard to taxation of Government property. 

Italy's plan is somewhat complicated, but in the main it is hoped 
that the following may be understood as complying with the terms of 
the Senate resolution referred to in the instruction. 

All taxable property belonging to the Government is listed and dis- 
tributed by the bureau of finance to the mayor of each commune, in 
order that they may be published and delivered to the collector. 

All immovable property of the country, both public as well as that 
held as private property, income-producing and otherw^ise, is admin- 
istered by the ministry of the treasury, but such movable property as 
is destined for the service of a particular branch of the Government is 
administered by the ministry upon w^hich that particular branch 
depends, so long, of course, as that property is so utilized. 

Government property is divided into what is called public domain 
and patrimonial property. National roads, the seashore, ports, bays, 
beaches, rivers, streams, town walls and gates, ditches, bulwarks of 
fortified towns and fortresses, constitute a part of the public domain. 
All other kinds of property belonging to the Government constitute 
its patrimony. The areas first referred to, such as fortifications or 
bulwarks of fortified towns no longer applied to such purposes, and 
any other propert}^ which ceases to be of public use or to serve as a 
national defense, passes to the domain called the patrimony of the 
Government. 

The property of the public domain by its nature is not alienable. 
The property which constitutes the patrimony of the Government 
may be alienated only in conformity with the laws concerning it. 

The patrimonial property is divided into that which is movable and 
that which is immovable and into property which can be disposed of 
and that which may not be. 

The immovable property destined for the use of Government admin- 
istration is considered as leased b}^ the administration for which the 
property is used. 

The class of property which may not be disposed of, such as build- 
ings and property where ministeries and other public offices are 
located — to wit, the patrimonial domain — are taxable for treasury, 
provincial, and communal taxes. 

The administration of the domain in the ministry of finance in prac- 
tice pays to the administration of taxes the tax due to the treasury 
(through a system of double-entry bookkeeping), but the other sums 
are paid to the collector of the communes, who in turn accounts to 
the provincial tax collector for the portion due the provincial admin- 
istration. 

It will be thus seen that the patrimonial domain pays its proportion 
of taxes to the State and by a cross entry the charge is satisfied, but 
so much of the assessment as is intended for communal purposes is 
actually paid over by the Government toward the support of the pro- 
vincial administration. 

Nothing, therefore, is exempt except the class of property which is 
referred to above as public domain. 

I have, etc., Thomas J. O'Brien. 



taxing government property. 7 

Legation of the United States of America, 

Madrid, April 18, 1913. 
The Secretary of State, 

Washington. 
Sir: Replying to the department's cu'cular instruction of February 
20, 1913, entitled '^ Taxation of Government property/' wherein 
I am directed to obtain the information as to Madrid called for by a 
resolution adopted by the Senate on the 18th day of February, 1913, 
as follows: 

Resolved, That the Secretary of State is hereby directed, through the diplomatic 
and consular officers of the Government, to ascertain the system of taxing Government 
property in the several capitals of the leading countries of the world, a full and com- 
plete report on the subject to be transmitted to the Senate at the earliest practicable 
day. 

I have the honor to report that by the laws of Spain all lards and 
buildings belonging to the Government are absolutely exempt from all 
land taxes or territorial contributions, except property belonging 
to the State that is held for sale and not for governmental uses, or 
real property acquired by the Government for nonpayment of taxes 
or for other reason not for governmental purposes, in which latter 
cases taxes are paid upon the property, provision therefor being 
made in the general State budget. 

I have, etc., Henry C. Ide. 

Legation of the United States, 

Buenos Aires, May 9, 1913. 
The Secretary of State, 

Wasliington. 
Sir: Referring to the department's circular instruction of February 
20 last, relative to the taxation of Government property in certain 
foreign capitals, I have the honor to report that in reply to the 
legation's request for information on this point the foreign office 
informs me that according to article 13 of law No. 5062, of February 
5, 1907, governing the taxation of real property in the federal capital 
and national territories the following property is exempt from taxa- 
tion: {a) Churches of all denominations; Q)) convents, correctional 
schools, and charitable institutions excepting such as produce 
income; (c) the property of the National Government; {d) the property 
of the municipal government and school boards; {e) the property of 
the government of the Province of Buenos Aires occupied by its 
public offices; (/) private schools where the teaching is free and in 
Spanish; {g) property exempted by special laws (e. g., property of 
foreign Governments) . 

I have, etc., John W. Garrett. 

American Embassy, 

Berlin, May 9, 1913. 
The Secretary of State, 

Washington. 
Sir: With reference to the department's circular instruction of 
February 20, 1913, directuig the embassy to obtain certain informa- 
tion desired by the Senate regarding the taxation of Government 
property in Germany, I have the honor to transmit herewith a 



8 TAXING GOVERNMENT PROPERTY. 

translation of sections 24, 28, 33-36, 44-45 of the Prussian com- 
munal taxation act of July 14, 1893, together with copies of the act 
in question,^ which fully furnish the information desired by the 
Senate. 

I have, etc., John G. A. Leishman. 



[Translation.] 

The provisions relative to the taxation of Government property 
are contained in sections 24, 28, 33-36, 44-45 of the Prussian com- 
munal taxation act of July 14, 1893, copy of which is inclosed. The 
pertinent sections follow: 

1. Taxes on Real Property. 

Section 24. All parcels of land situate in a parish, whether built 
on or not, shall be subject to the taxes on real property, with the 
following exceptions: 

(a) The royal palaces, including annexes, courts, and gardens. 

(h) Land belonging to a foreign country on which embassy or 
legation buildings are erected, including all the buildings erected 
thereon, provided reciprocity is guaranteed by the foreisfn country. 

{c) Land and buildings belonging to the State, the Provinces, the 
Kreise, the parishes, or other communal associations, if appointed for 
public service or use. 

(d) Bridges, artificial roads, railroad tracks, and navigable canals 
constructed for public use ^^ith. the consent of the State. 

(e) Dykes of the dyke associations and private dykes under State 
supervision in the public interest, as well as plants of the drainage 
and irrigation associations maintained in the public interest. 

(/) University buildings and other buildings appointed for public 
instruction. 

(g) Churches, chapels, and other buildings devoted to public reli- 
gious service, as well as the buildings for religious service of religious 
bodies with the rights of corporations. 

(Ji) Poorhouses, orphanages, and public hospitals, prisons, houses 
of correction, houses of protection, and charitable institutions 
charged with sheltering the helpless and morally endangered (farm 
girls' homes and the like), as well as buildings bclongmg to chari- 
table foundations and directly used for their purposes; other build- 
ings of such charitable foundations which do not benefit merely 
s])ecified persons and families can also be exempted by act of the 
parish. 

(i) The real estate of the institutions and bodies recited under 
f, g, h, if such real estate is directly used for their purposes. 

(Tc) The official real estate and residences of the clergy, church 
servants, and common-school teachers, in so far as they have been 
exempted Irom taxation hitherto. 

All other exemptions not based on a special title of law (sec. 21), 
particularh" those of the official land and dwellings of Government 
officials, shall be canceled. 

If land or a building is only partly intended for public service or 
use, the exemption embraces only such part. 

I Not printed. 



TAXING GOVEKNMENT PROPERTY. 9 

The provisions of the cabmet order of June 8, 1834 (Gesetz- 
Saininluug, p. 87), shall remain m force and be extended to all 
parishes m which they have not yet been made effective. 

Section 28. The following trades and industries shall be subject 
to the trade taxes of the parishes where conducted: 

(1) Standing busmesses assessable under the trade-tax act of June 
24, 1891 (Gesetz-Sammlung, p. 205). 

(2) Agricultural spirits distilleries. 

(3) Mines. 

(4) The industrial production of amber, j)eat cultivation, the 
excavation of sand, gravel, loam, marl, clay pits, and the like, the 
working of stone, slate, lime, and chalk breaks and the like. 

(5) The trades and industries of communal and other public asso- 
ciations. 

(6) The trades and mdustries of the State and the E-eichsbank. 
Any trades and industries designated under 2 to 6, the annual 

yield of which does not reach 1,500 marks, and the foundation and 
working capital 3,000 marks, likewise the trades and mdustries of 
the communal associations exempt under section 3, No. 4, of the 
trade-tax act of June 24, 1891, shall be exempt from the trade tax. 
This provision shall not apply to the business tax. 

The operation of the State railways and the private railways 
liable to the railway tax is exempt from the trade tax. 

Itinerant trades shall not be liable to the trade tax in the parishes, 

2. Communal Income Tax. 

Section 33. The following shall be subject to the communal 
income tax: 

(1) All persons having a domicile in the parish (sec. 1 of the mcome- 
tax act of June 24, 1891; Gesetz-Sammlung, p. 175) to the extent 
of their total income within and without Prussian territory, provided 
the same is not exempted. 

(2) All persons who, without being domiciled in a parish, have 
there real property, commercial or industrial plants, includuig mines, 
are engaged in commerce or trade or mining mdependent of any 
mining company, or participate as partners m the undertakmg of 
any limited-liability company, to the extent of the mcomc accruing 
to them from these sources in the parish. 

(3) Stock companies, commandite stock companies, mining com- 

Eanies, registered cooperative societies whose business extends 
eyond the circle of members (especially cooperative societies with 
public stores) and juridical persons (particularly parishes and other 
communal associations) which have real estate, commercial or in- 
dustrial establishments, including mmes, in the parish, conduct a 
trade or an industry, including minin;2:, or participate as a partner in 
the undertaking of any limited-liability company, to the extent of 
the income accrumg to them from these sources in the parish. If 
assessment for the State income tax has been made, the communal 
income tax shall embrace the income so assessed, except in cases 
provided for by section 16, paragraph 3, of the income-tax act. 

(4) The State treasury to the extent of its income from the railway, 
mining, and other industrial undertakings conducted by it, as well as 
from the domains and forests. ^ ^ 



10 TAXING GOVERNMENT PROPERTY. 

Railway stock companies which have surrendered their under- 
takings to the State in return for an annuity to be paid directly to the 
stockholders, shall not be considered as owners of the railways. 

Each block of real estate and each undertaking of the State treasury 
liable to taxation shall be equivalent to a separate person in respect 
of liability to taxation. All the State railways and railways operated 
for the account of the State shall be considered one undertakmg liable 
to taxation. For the rest the superior administrative authorities shall 
determine what is to be considered as a separate mining or other 
industrial undertaking of the State treasury. 

New residents may be assessed for the tax in the same way as the 
other residents of the parish, even if they have no domicile in the 
parish, provided they have resided there for more than three months. 

Section 34. The income from land, whether built on or not, which 
is wholly or partly exempted from the tax on real property under 
section 24 shall to such an extent be exempt from the communal 
income tax. 

Section 35. The conduct of any trade or industry, including min- 
ing, by persons designated in section 33, Nos. 2, 3, and 4, likewise 
commercial companies, shall be subject to taxation only m those 
parishes where the seat, a branch, a workshop or sales shop, or an 
agency of the undertaking is situated, the last named with powers 
to do legal business in the name and for the account of the owner or 
company. The railways shall be liable to taxation in tlie parish 
where the seat of the management (or the State railway administra- 
tion authorities), a station, or any independent establishment or 
workshop or any other industrial plant is situated. 

Section 36. Communal income taxes may only be levied on the 
basis of the State income-tax assessment and, as a rule, take the form 
of extra taxes. These extra taxes must be uniform. No additions to 
the complementary tax shall be allowed. 

If an income liable to the communal income tax is neither wholly 
nor partly assessed for the State income tax, the rate according to 
w^hich the extra tax is to be calculated shall be ascertained pursuant 
to the regulations governing assessment for the State income tax, pro- 
vided sections 44 to 46 do not stipulate otherwise. 

Any increase or reduction of the State income tax once assessed 
on the ground of appeal or other legal action or effected under 
sections 57 and 58 of the income-tax act of June 24, 1891, shall entail 
a corresponding change in the communal extra tax. 

Section 44. The net income from the Government domains and 
forests shall be calculated for the various estates from the net yield 
of the land tax according to the proportion m which the surplus of 
receipts over expenditures as settled by the budget to have been 
attained from the domains and forests m a Provmce stands to the 
net yield of the land tax, making due allowance for any obligations 
and administrative costs encumbermg the property. 

The ])roportion shall be definitely fixed by the competent minister 
every year and shall be made public. 

Section 45. The surplus of the receipts over the expenditures of 
State railways and railways operated for the account of the State as 
settled by the accounts shall be considered as their net income. 
There shall, however, be added to the expenditures 3^ per cent interest 



TAXING GOVERNMENT PROPERTY. 11 

on the construction or purchase capital according to the official 
statistics of railways in operation. The total resulting amount liable 
to taxation shall be definitely fixed by the competent minister each 
year and made public. 

[Translation.] 

COLLECTION OF LAWS FOR THE ROYAL PRUSSIAN STATES, NO. 21. 

Contents: Law on the abolition of direct State taxes, page 119. — Supplementary tax 
law, page 134. — Communal tax law, page 152. 

NO. 9627. LAW ON THE ABOLITION OF DIRECT STATE TAXES OF JULY 

14, 1893. 

We, William, by the grace of God King of Prussia, etc., ordain, with 
the consent of both houses of the diet of our monarchy for the dis- 
trict which they comprise, with the exception of the island of Helgo- 
land, as follows: 

Section 1 . For the sake of alleviating and otherwise regulating the 
public burdens of the communes (manor precincts), the following 
direct State taxes to the State treasury are hereby abolished: 

1. The land and building tax established according to the laws of 
May 21, 1861 (Law Coll., pp. 253 and 317), and according to the 
supplementary and amendatory laws enacted thereto. 

2. The industrial and manufacturing tax established according to 
the law of June 24, 1891 . (Law Coll., p. 205.) 

Sec. 2. The following are likewise abolished: 

1 . The supervisory and mine tax payable by the mines in the older 
regions on the right bank of the Shine. (Law on the taxation of 
mines for the whole territory of tne monarchy, excepting the regions 
situated on the left bank of the Rhine, of May 12, 1851; sec. 8, Law 
Coll., p. 261 ; law relating to mine taxes, of Oct. 20, 1862, sec. 4, Law 
Coll., p. 351.) 

2. The mine tax to be paid in the other regions of the country. 
(Law relating to mine taxes, of Oct. 20, 1862, sec. 6; ordinances for 
the territory of the former Kingdom of TTanover, of May 8, 1867, 
Art. XXI, Law Coll., p. 601 ; for the territory of the former electorate 
of Hessia, the city of Frankfurt, and the former royal Bavarian por- 
tions of territory, of June 1, 1867, Art. XVII, Law Coll., p. 770: for 
the former Duchy of Nassau, the former grandducal Hessian portions 
of territory, and the former landgraviate of Hessia Homburg, includ- 
ing the superior bailiwick of Meisenheim, of June 1, 1867, Art. I, sec. 
2, Law Coll., p. 802; law on the introduction of the general mining 
law of June 24, 1865, into the territory of the Duchy of Lauenburg, 
of May 6, 1868, Art. VII, official weekly for the Duchy of Lauenburg 
for 1868, No. 36; law on the introduction of the general mining law 
of June 24, 1865, into the territory of the Duchies of Sleswick and 
Ilolstein, of March 12, 1869, Art. IX, Law Coll., p. 453.) 

Sec. 3. Unless otherwise provided hi the present law and in the 
law on communal taxes, the provisions of sections 1 and 2 of the 
afore-mentioned laws shall remain in force. 

Unless otherwise provided in the present law, the assessment and 
administration of the land, building, and industrial tax shall be at- 
tended to by the State for the purposes of communal taxation, the legal 
arrangements existing for this purpose being preserved. The coopr 



12 TAXING GOVERNMENT PROPERTY. 

eration of the ''States of the r^alm" in the administration of the land 
tax within the municipal district of Upper Lusatia (law on the final 
subdistribution and collection of the land tax, etc., of Feb. 8, 1867, 
sec. 49, Law Coll., p. 185) is not affected hereby. 

Sec. 4. The assessment (sec. 3) shall extend to those lands, build- 
ings, and industrial works which have remained exempt from the 
appropriate State tax but are liable to the communal tax according 
to the provisions of the communal tax law. 

Unless otherwise provided in the present law and in the communal 
tax law, the general legal provisions shall govern in the assessment 
which would have been applicable in assessing the corresponding 
State taxes. Particularly are the same legal remedies admissible 
against the assessment as would have been available in opposing the 
assessment of the corresponding State tax. 

Sec. 5. Existmg legal provisions which make other legal conse- 
quences, especially the establishment of rights or duties, contingent 
on the assessment of the taxes indicated in section 1 (Nos. 1 and 2), 
shall remain in force; as far as the payment of such taxes is presumed 
in this connection, the assessed amounts will take the place of those 
to be paid. 

This provision shall not be applicable to the provisions of section 9, 
article I, No. 4, of the income-tax law of June 24, 1891 (Law, Coll., p. 
175). ^ _ ■ 

The provision is likewise not applicable to the formation of the 
primary-elector sections for the elections to the house of deputies. 
Special legal provisions will be enacted regarding these as well as 
regarding the formation of electoral sections for the election of com- " 
munal representatives. 

Sec. 6. The special regulations existing for the Provmces of Rhine- 
land and Westphalia regarding the fund for coverings the land tax 
and the fund for the preservation and renewal of the cadaster (land- 
tax law for the western Provinces of Jan. 21, 1839, sees. 2 under b and 
c, sees. 4, 44 to 48, Law Coll., p. 30, and ordinance relating to the 
determination and subdistribution of the land tax in the two western 
Provinces, of Dec. 12, 1864, sees. 3, 4, and 21, Law Coll., p. 683) go 
out of force. 

The provisions prevailing generally in the other regions shall take 
the place of these regulations. 

Upon the funds being dissolved, the amounts on hand, as well as 
the assets and liabilities existing at the time, shall go — 

1. Those of the fund for the covering of the land tax to the respec- 
tive governmental districts in proportion to the assessed land, tax. 

2. Those of the fund for the preservation and renewal of the cadas- 
ter to the State treasury. 

Sec. 7. The provisions of Article II of the law on the alienation 
and mortgaging of real estate within the sphere of jurisdiction of the 
Rhenish law of May 20, 1885 (Law Coll., p. 139), relating to the preser- 
vation of copies of cadaster documents and the issuing of certified 
extracts therefrom, are extended to the remaining parts of the Rhine 
Province and to the Province of Westphalia. 

Sec. 8. As far as the punishment of contraventions of the pro- 
visions relating to land, building, and industrial taxes is made con- 
tingent on the withholding or the forfeiture of the tax with respect 
to the State (law on building taxes of May 21, 1861, sec. 17, par. 3; 
law on the final subdistribution and collection of the real estate tax 



TAXING GOVERNMENT PROPERTY. 13 

in the six eastern provinces, of Feb. 8, 1867, sec. 34, par. 3; law on 
the enforcement and regulation of the real estate tax in the Provinces 
of Sleswick-Holstem, Hanover, and Hesse-Nassau, as well as in the 
kreis of Meisenhcim, of Feb. 11, 1870, sec. 1, Law Coll., p. 85; and 
industrial law of June 24, 1891, sec. 70), it shall be considered that 
the amount is withheld (forfeited) which would have been payable 
to the State treasury in proportion to the assessment (sec. 3, par. 2; 
sec. 4) in case the tax had continued to be collected. 

The period of three months for announcing newly erected build- 
ings, as provided in section 17, paragraph 3, of the building tax law 
of May 21, 1861 (sec. 15 under 4, loc. cit.), likewise with respect to 
material improvements in buildings, as well as enlargements of the 
yards and gardens belonging thereto (sec. 15 under 5, loc cit.), begins 
with the expiration of the Sscal year in which the change has taKen 
place. 

Sec. 9. A commune entitled to a proportional amount of taxes 
according to the communal tax law shall have a right to collect addi- 
tional taxes (building tax law of May 21, 1861, sec. 17, par. 4; law of 
Feb. 8, 1867, sec. 34, par. 4; law of Feb. 11, 1870, sec. 1; industrial 
tax law of June 24, 1891, sees. 70, 78). 

Sec. 10. The proAasions of section 81 of the industrial tax law of 
June 24, 1891, are repealed. 

The cessation of an industry liable to tax shall not be announced 
to the office of collection (sec. 58, par. 1, loc. cit.), but to the presi- 
dent of the tax committee authorized to make the assessment. 

Sec. 11. The collection of the land, building, and industrial tax 
shall be incumbent upon the commune which is entitled to collect 
the proper tax according to the provisions of the communal tax law. 

Shortages shall affect the communal treasury. The power to re- 
mit or moderate assessed taxes (law on the remission or moderation 
of land taxes in consequence of floods, of Apr. 15, 1888, sec. 1, Xo. 1, 
Law Coll., p. 99; industrial tax law of June 24, 1891, sees. 44, 45) 
goes over to the communes. 

The legal provisions regarding the claims of the communes to joint 
administration of their treasuries by State treasury officials (com- 
munal regulations for the Ehine Province of July 23, 1845, sees. 79, 
106; Law Coll., p. 523; village commune regulations for the province 
of WestphaUa of Mar. 19, 1856, sees. 44, 73, Law Coll., p. 265) are 
repealed. 

Sec. 12. The provisions of the industrial tax law of June 24, 1891, 
which relate to the tax on industrial works, shall be applicable accord- 
ing to the following rules: 

1. If an industry liable to the industrial tax extends over several 
kreise, then one-half of the tax amounts stipulated in section 60, Nos. 
1 and 2, loc. cit., shall be paid for each kreis. This provision shall 
not apply to the industrial works mentioned in section 60, paragraph 
2, loc. cit. 

2. The industrial tax shall be fixed by the landrat ui the land- 
kreisen, by the head of the commune in the city lo-eisen, and by the 
director of the administration of direct taxes in Berlin. 

These authorities shall also have the power to reduce the industrial 
tax according to section 61 and to make the other determinations as 
per section 65, paragraph 2, loc. cit. 

3. The industrial tax shall be paid in one amoimt within two 
weeks after the delivery of the tax statement. 



14 TAXING GOVERNMENT PROPERTY. 

The taxpayers mejitioned iii section 61, loc. cit., shall pay their tax 
before opening up their works, or, in case the tax statement has not 
been sent to them by that time, they must deposit a sum of money 
to be determined by the head of the commune to cover the amount of 
the tax; otherwise they may be prohibited from carr^'ing on their 
industry in accordance with section 63, loc. cit. 

Sec. 13. The communes (manor precincts) shall be obliged to 
collect the industrial tax, to the amounts assessed (sec. 12), from the 
taxpayers of their district. 

The communes (manor precmcts) of the landkreise shall remit the 
amounts collected to the kreis communal treasury at the end of each 
quarter. 

If the communes, according to the provisions of the communal tax 
law, have introduced new industrial taxes, they must remit to the 
kreis communal treasury the amount which would be yielded if the 
provisions of sections 60 to 69 of the industrial tax law of June 24, 
1891, and of section 12 of the present law were enforced. 

The kreis must employ the proceeds of the industrial tax due 
them (pars. 2 and 3) in order to defray their expenses. 

Sec. 14. The expenses of assessing and administering the taxes (sec. 
3, par. 2 ; sec. 4) shall be defrayed from the State treasury unless they 
arise from the business turned over in this connection to the communes. 

The amounts collected in the way of fees, costs, and penalties 
within the scope of the land, buildmg, and industrial tax shall go 
into the State treasur}'. 

If, w^ithin the scope of the cadaster administration, it is proposed 
to execute new surveys of whole districts or large parts thereof on 
the part of the commune or of the mterested landowners, or if this 
redounds mainly to the benefit of the commune or of the interested 
landowners, the execution of the work may, by order of the minister 
of finance, be made contingent upon the payment of a contribution 
toward the cost of the new survey on the part of the commune or of 
the interested landowners. 

Sec. 15. The expenses of collectmg the taxes (sees. 11, 13) shall be 
borne by the communes. 

The legal provisions regarding the obligation on the part of the 
land-tax payers to pay extra additional amounts to defray the ele- 
mentarv costs of collection (land-tax law for the western provinces of 
Jan. 2\\ 1839, sees. 2a, 3 ; law of Feb. 11, 1870, sec. m are repealed. 

Sec. 16. The legal provisions regarding the claims of the communes 
(manor precincts) to draw compensation for the business turned over 
to them in connection with the assessment of the industrial tax and 
the income tax (industrial tax law of June" 24, 1891, sec. 75, par. 1; 
income tax law of June 24, 1891, sec. 73, par. 1) go out of force. 

By royal order the obligation may be imposed on the communes 
and independent manor precincts to attend to the elementary 
collection in their districts of all State taxes, domanial annuities, 
annuity-bank annuities, and land-tax-indemnity annuities, as well 
as to the remission of the amounts collected to the proper State 
treasm-ies, all without compensation. 

Sec. 17. There shall no longer be any claims for land-tax indemni- 
ties as per sections 1 , 1 5 to 17, of the law of February 11, 1870, and the 
law on land-tax indemnity of May 21, 1861 (Law Coll., p. 327), nor 
to any other indemnities to be allowed by the State and laying down 
as a condition precedent the payment of the land tax to the State. 



TAXING GOVERNMENT PROPERTY. 16 

Sec. 18. Indemnities paid in accordance with sections 1 to 4 of 
the law on land-tax indemnities of May 21, 1861, and sections 1 to 15 
of the law of February 11, 1870, for the aboHtion of exemptions from 
and privileges in regard to land taxes, shall be restored to the State 
treasury in accordance with the following rules: 

In this connection, if the indemnity has taken place in the way of 
a remission of domanial taxes or domanial amortization annuities, 
the indemnity capital to be restored should be calculated at 20 times 
the amount of the remitted tax or annuity. 

Sec. 19. There shall be no restoration (sec. 18) in regard to estates 
and lands which have been alienated, after the payment of the indem- 
nity, through an onerous legal transaction (legal transaction involving 
a consideration). 

If the alienation has related only to a part of the estate or land, 
the amount to be restored shall be determined according to the 
proportion of the land tax. 

If, however, the alienated part consists only of fractions segregated 
for the purpose of public roads, rivers, creeks, canals, or railroads, 
the amount of indemnity corresponding thereto shall not be deducted 
from the indemnity paid on the whole estate or land unless the party 
obliged to make the restoration proves that the net amount of land 
tax on the fractions segregated constitutes more than one-tenth of 
the net amount of land tax on the whole estate or land and at the 
same time amounts to more than 30 marks. 

There shall, moreover, be no restoration (sec. 18) in case the pro- 
visions of section 5 of the law of May 25, 1885 (Coll. of Laws, p. 170), 
have not been applied because the owner of the property concerned 
has not fulliUed the requisites prescribed in section 7, loc. cit. 

With respect to estates and land whose ownership has been trans- 
ferred, after the payment of the indemnity, by gift or legacy, or 
in consequence of distribution among heirs or of contracts of con- 
veyance of property, the restoration of the indemnity capital shall 
not be made with respect to the fraction of property in which the 
actual owner has neither fallen directly nor indirectly heir to the 
indemnified party. 

Sec. 20. Cities which have been indemnified according to section 7 
of the law of May 21, 1861, must return the indemnity received to 
the State treasury. 

If the indemnity sum turned over to a city commune has been 
distributed among the individual owners of the property within the 
municipal precincts (sec. 18, par. 2, loc. cit.), these owners must make 
restoration to the State treasury in accordance with sections 18, 19. 

Sec. 21. Communes which have employed the land-tax indemnity 
for works of public utility not yielding any income may have all or 
part of the amount of restoration remitted by the minister of finance. 

If, owing to private agreements, the abolition of the State land 
and building tax would be' of no benefit to the landowner, the minister 
of finance may postpone the date of restoration and the beginning 
of bearing of interest until the agreement in question has expired, 
but not longer than up to April 1, 1910. 

Sec. 22. If the exemptions from land and building taxes provided 
by the law of May 21, 1861 (Law C^olL, pp. 253 and 317), have been 
bought up by contract, the indemnity received must be restored to 
the State treasurv. 



16 TAXING GOVERNMENT PROPEETY. 

The provisions of section 19 shall be appropriately applicable. 

Sec. 23. The capital to be restored (sees. IS to 22) shall bear interest 
at the rate of 3^? per cent, payable by the taxpayers from April 1, 
1895, on. 

It shall be the duty of the minister of finance to determine the 
amount of capital to be restored. 

The taxpayers shall have a period of three months, from the date 
of notification of the amount to be restored, within which to appeal 
from the amount determined. 

Taking the matter to law shall have a postponing effect. 

Sec. 24. Amounts of capital (sec. 23) under 25 marks and those 
exceedmg a sum divisible by 25 marks without remainder must be 
paid into the State treasury within a period of six months after they 
nave been finally determined, together with the interest accruing 
up to the date of payment. 

It shaU be optional to the taxpayer either — 

1. To pay back also to the State treasury the remaining amount 
of the capital to be restored, together with interest, within six months 
after the final determination of the amount; or 

2. In lieu thereof for a period of 60^ years from April 1, 1895, to 
pay an amortization annuity of 4 per cent per annum of the capital, 
payable in quarterly installments, whereby the capital, bearing 3^ per 
cent interest, as well as one-half per cent and the mterest on the origi- 
nal amount of capital saved through the progressive amortization, 
wdll be paid off. 

Even during the period of 60 J years the taxpayer may whoUy or 
partially redeem the amortization annuity, at the beginning of each 
fiscal year, by paying in cash the still unredeemed part of the capital, 
but provided that, in case of partial redemption, the part of the 
amortization annuity to be redeemed must constitute a round sum 
of full marks. The amounts which are required in the vaiious years 
of the amoitization period of 60^ years are showm in the accompanying 
amortization table. 

The amounts due in capital and revenue may be collected by 
means of an action at law for forcible collection. 

Sec. 25. The obligations arising from sections 18, 19, and 20, para- 
graph 2, and sections 22 to 24, burden the estates and land for which 
the indemnity has been given, in the way of a public encumbrance 
which passes to each o^^^ler. 

If an estate or piece of land subject to an amortization annuity is 
divided up into parcels, the amortization annuity must be distrib- 
uted according to the provisions of sections 2 to 5 of the law regarding 
the distribution of public burdens in the case of division of real estate, 
etc., of August 25, 1876 (Law Coll., p. 405), provided, however, that 
the district government shall confirm the plan of distribution. 

If upon the division of property there should be any amortization 
annuities under one mark or in excess of amounts represented by 
full marks, they shall be redeemed by payment of capital according 
to the provisions of section 24. 

In the cases contemplated in section 19, paragraph 3, there can be 
no distribution. 

Sec. 26. Except where otherwise provided in sections 24 and 25, 
the payment, insurance, and amortization of the capitals and amor- 
tization annuities shaU be governed by the appropriate provisions of 
sections 18 to 27 of the law on the establishment of annuity banks of 



TAXING GOVERNMENT PROPERTY. 17 

March 2, 1850 (Law Coll., p. 112), except that the district govern- 
ment sliall take the place of the annuity bank. 

Sec. 27. AM amounts paid in the way of restoration of capital, 
together with interest (sees. 18 to 25) in the course of each fiscal 
year, shall be turned over to the fund for the extinction of State debts, 
for the purpose of extinguishing State debts by the redemption of a 
due amount of certificates of indebtedness. 

Sec. 28. The law regarding the turning over of amounts received 
as agricultural dues to the communal districts, of May 14, 1885 (Law 
Coll., p. 128), goes out of force. 

If the kreise have not by April 1, 1895, received the amounts to be 
turned over to them for the fiscal year 1894-95, or if they have not 
yet readied a final decision as to the employment of these amounts, 
the provisions of said law will also be applicable. 

Sec. 29. The provisions of sections 1 to 27 are not applicable to the 
Hohenzollern lands. 

It is reserved for a special law to remodel the system of direct taxes 
in these lands. 

Until such a law^ is enacted, a permanent annual sum of 62,020 
marks will be allotted from the State treasury from April 1, 1896, for 
the Hohenzollern lands. 

This amount will be distributed among the various communes 
according to the numbers if inhabitants ascertained by the census 
immediately preceding. The use to which the money is to be put 
will be left to the decision of the representatives of the communes in 
question. 

Sec. 30. The present law goes into force on April 1, 1895, but only 
simultaneously with the communal tax law and the supplementary 
tax law; the provisions of sections 7 and 10 (par. 1), section 11 
(par. 3), section 14 (par. 3), and sections 17 to 25 (par. 1) go into 
force from the day of promulgation. 

The first assessment for the purposes of the communal taxation 
(sec. 3, par. 2, sec. 4) will take place according to the provisions of this 
law for tlie fiscal year 1895-96. 

The arrears of the taxes mentioned in sections 1 and 2 and remaining 
over on April 1, 1895, shall be paid into the State treasury in accord- 
ance with the provisions in force up to that time; the same rule 
applies to additional taxes and penalties within the scope of the land, 
building, and industrial tax. 

Sec. 31. The ministers of finance and interior are charged with the 
enforcement of this law. 

Witness our own signature and royal seal affixed. 

Given at the New Palace, July 14, 1893. 

[l. s.] William. 

Ct. zu Eulenburg. 
v. boetticher. 
v. schelling. 
Bar. v. Berlepsch. 
Ct. V. Capri VI. 

MlQUEL. 

V. Kalterborn. 
» V. Heyden. 
Tiiielen. 

BOSSE. 

S. Doc. 163, 63-1 2 



18 



TAXING GOVERNMENT PROPERTY. 



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20 TAXING GOVERNMENT PROPERTY. 

(NO. 9628.) SUPPLEMENTARY-TAX LAW OF JULY 14, 1893. 

We, William, by the grace of God King of Prussia, etc., ordain, 
with the consent of both houses of the diet of our monarchy, for the 
extent thereof, with the exception of the Hohenzollern lands and tbe 
island of Helgoland, as follows: 

Sec. 1. From April 1, 1895, a supplementary tax shall be col- 
lected in accordance with the following rules : 

I. Liability to Taxation. 

Sec. 2. The following shall be liable to the supplemenfcar\^ tax: 

I. Tlie natural pereons designated in section 1 of the income-tax 
law of June 24, 1891 (Law Coll., p. 175), under Nos. 1 to 3, according 
to the total value of their taxable property. (Sec. 4.) 

II. Without regard to nationality, residence, or abode, all natural 
pei^ons according to the value — 

(a) Of their land owned in Prussia. 

(h) Of their fundamental and operative capital used for the 
operation of farms or forestr}^ (including cattle raising, viticulture, 
fruit culture, and gardening), of a mine, or of a permanent industry 
in Prussia. 

Sec. 3. Persons exempt from the income tax according to section 
3 of the income-tax law (Nos. 1 to 4) shall be exempt from the 
su]>plementary tax. 

The exemptions under Nos. 3 and 4 of said law shall not extend 
to the property designated in section 2 (II), and they shall not be 
granted in cases in which reciprocity is not granted in the states 
(nations) concerned. 

II. Standard of Taxation. 

(1) Taxable property. 

Sec. 4. The whole amount ot property, real and personal, shall 
be liable to taxation after debts are deducted. (Sec. 8.) 

1. The following shall be particularly considered as taxable prop- 
erty within the meaning of this law: 

i. Real estate (land and buildings), together with all appurte- 
nances, mining property, usufructs, and other independent rights and 
privileges having a value calculable in money. 

2. The capital employed in the establishment and operation of 
agricultural and forestry enter])rises (including cattle raising, viti- 
culture, fruit culture, and gardening), in mining, and in some 
industry. (Sec. 6.) 

3. Other capital. (Sec. 7.) 

tl. ITie following shall be exempt from taxation: 

1. Real estate situated outside of Prussia. 

2. Fundamental and operative capital used in agricultural or 
forestry enter])ri'>ie, mining, or permanent industry outside of Prussia. 

III. TJie following shall not })e considered as taxable property 
within the meaning of this law: 

Furniture, household goods, and other movable corporeal things^ 
in so far as they can not be considered as appurtenances of real estate. 



TAXING GOVERNMENT PROPERTY. 21 

(I, No. 1) or as an adjunct of finulamontal or operative capital 
(I, No. 2). 

Sec. 5. For ])urp()ses of assessment of taxes the followin<^ shall he 
calculated in addition: 

1. With respect to the actual trustee, the ])ropcrty or parts of 
property helongin^^ to a trust fund. (Sec. 3 of the inheritance-tax 
law as enacted on May 24, 1891, Law Coll., p. 78.) 

2. With respect to the heirs according to their share of inheritance, 
the property l3elono:ing to an undivided final estate. 

3. With respect to the individual shareholders according to their 
share, property belonging to the fundamental and operative capital 
of a commercial company not liable to the income tax according to 
section 1, Nos. 4 and 5, of the income-tax law. 

4. With respect to the householder, the property of those members 
of a household whose income is to be charged to him additionally 
according to section 11 of the income-tax law when assessment is 
made. 

Sec. 6. The fundamental and operative capital (sec. 4, I, No. 2) 
includes all objects and rights devoted to the industry in question 
and which have a value calculable in money. 

In the case of taxpayers who maintain a permanent business 
outside of Prussia by keeping branch establishments or manufac- 
turing, purchasing, or selling ofRces, that part of the fundamental 
and operative capital which corresponds to the operations carried 
on outside of Prussia will not be assessed. 

Sec. 7. The remaining capital (sec. 4, I, No. 3) includes: 

(a) Interest-bearing and noninterest-bearing recorded and unre- 
corded capital assets of every kind, including the value of stocl^ or 
shares, limited-liability shares, mining shares, business assets in 
case of partnerships, business shares, and other moneys paid into 
companies. 

(b) Cash in the form of German currency, foreign moneys, l^ank 
notes and certificates, with the exception of money on hand derived 
from the yearly income of the taxpayer, as wed as of gold and 
silver in bars, in so far as the assets under a and h are not to be 
regarded as portions of a fundamental and operative capital. (Sec. 6.) 

(c) The capital represented by appanages, annuities, life rents, 
amounts drawn by aged persons making over their estate to an 
heir, and other periodical pecuniary revenues due the taxpayer 
during his or another's life, for an indefinite time or for a period of 
at least 10 years, either by virtue of agreement as a compensation 
for the surrender of property or of final testaments or settlements 
or by virtue of family tradition. 

Sec. 8. The following are to be deducted from the assets: (1) The 
^^real" and personal ''capital" debts of the taxpayer, with the excep- 
tion of those obligations which have been incurred in order to defray 
current household expenses (housekeeping debts); and (2) the capital 
represented by appanages, annuities, Altenteilo (amounts drawn by Jin 
aged person making over his estate to an heir), and other periodical 
pecuniary payments to which the conditions contemplated in section 
7 under (c), paragraph 1, apply and which are to be paid by the 
taxpayer or from a trust fund, in so far as these obligations (Nos. 1 
and 2) are not attached to parts of property which must be left out 
of consideration in makhig the assessment. (Sec. 4, 11.) 



22 TAXING GOVERNMENT PROPERTY. 

If the taxation extends only to the parts of property designated 
in section 2, II, under (a) and (b), then only those debts, etc., can be 
deducted which are attached to these portions of the property or 
have been incurred for the sake of their gain. 

Obligations which are attached at once to taxable and nontaxable 
parts of an estate shall be deducted v^dth respect to the former only 
m the proportion of these parts to the whole estate. 

(2) Determination of value. 

Sec. 9. In calculating and appraising taxable property, the amount 
and common value of the individual parts thereof at the time of the 
assessment (declaration of property) will be taken as a basis, except 
where otherwise provided hereinafter. 

Sec. 10. In agricultural and industrial enterprises in which regular 
annual balances are struck, the amount of assets at the close of the 
last fiscal year may be taken as a basis in calculating and appraising 
the taxable property. 

Sec. 11. In estimating the value of real estate utilized m the oper- 
ation of agricultural and forestry enterprises, cattle raising, viticul- 
ture, fruit culture, and gardening, it shall be necessary to take mto 
consideration both the live and dead economic inventory as well as 
other assets pertaining to the fundamental and operative capital 
(sec. 6), including objects serving in the industrial side enterprists, 
provided, however, that excesses or deficits in value of the inventory 
m comparison with an economically normal amount must be added or 
deducted in the calculation. Stocks of goods left over from previous 
fiscal years and intended for sale shall be taken into account as 
obvious pieces of property. 

The value of pieces of real estate which are devoted to a mining, 
commercial, or industrial enterprise shall be taken into consideration 
in ascertaining the fundamental and operative capital of the enter- 
prise in question. 

Sec. 12. Cash of German coinage and imperial bank notes and 
certificates shall be assessed at their nommal value, and silver and 
gold in bars as well as foreign coins at their selling value. 

Other securities shall be estimated at their value in the German 
stock exchange if they have one, otherwise according to their selling 
value. 

All other assets and debts shall be assessed at their nominal value, 
unless the cojiditions contemplated in section 16, paragraph 4, are 
present, or unless other circumstances exist which warrant the assump- 
tion of a selling value differing from the nominal value. 

Sec. 13. For the sake of ascertaining the capital represented by 
usufructuary rights, appanages, annuities, life rents, Altenteilsbezii- 

fen (amounts drawn oy aged persons making over their estates to 
eirs), and other periodical revenues and services due, the money 
value of a single y(\ir's revenue or service due shall be determined 
according to the following rules, unless the case contemplated in 
section 5, No. 1, is present: 

I. In the case of perpetual revenues and services due, 25 times the 
amount of one 3^ear shall be taken as the capital represented, and in 
the case of revenues and services due which are of indefinite duration, 



TAXING GOVERNMENT PROPERTY. 23 

12^ timos th(^ amount of ono year shall be taken, unless the provisions 
under II and III apply or there are other circumstances which limit 
the maximum duration. 

II. If the right is limited to the lifetime of the entitled party or of 
another person, the capital represented shall be determined according 
to the age attained at the time of assessment (declaration of property) 
by the person at whose death the right is extinguished, the number 
of times the service due for one year being as follows at the ages 
mentioned: Fifteen years or under, 18 times; 15 to 25 years, 17 
times; 25 to 35 years, 16 times; 35 to 45 years, 14 times; 45 to 55 
years, 12 times; 55 to. 65 years, 8i times; 65 to 75 years, 5 times; 75 
to 80 years, 3 times; 80 years, 2 times. 

III. If the duration of the right is dependent on the length of life 
of several persons in such a way that at the death of the one dying 
first the revenue or service due will cease, then the age of the oldest 
persons wiU be taken as the guide in ascertaining the capital repre- 
sented, as per II above. If the right is to last until the death of the 
person dying last, the calculation shall be according to the age of the 
youngest person. 

IV. The capital represented by revenues or services due which are 
limited to a certain period shall be determined at the time of assess- 
ment (declaration of property) according to the appended table, on 
the basis of 4 per cent interest. If, however, the duration of the right 
is besides dependent on the duration of life of one or more persons, 
the capital as calculated according to the rules under II and III shall 
not be exceeded. 

V. In the case of revenues or services due which are not fixed in 
amount or money value, the money value of the amount of the reve- 
nue paid or service rendered in the last year shall be taken as the 
basis, and if a full year's payment or service has not yet been received, 
then the money value of the presumable amount for the current year 
shall serve. 

Sec. 14. From the capital represented by noninterest-bearing 
claims and debts of fixed period 4 per cent interest per annum shaQ be 
deducted up to the time they are due. 

Sec. 15. Clainas for life and capital and income insurance which 
are not yet due shall be calculated at two-thirds the amount of 
premiums paid up or of the capital contributions, but if the amount 
IS proved at which the insurance company would redeem the policy 
then this redemption value shall be taken as the basis of calculation. 

Sec. 16. Except in the case of section 15, rights and encumbrances 
contingent on a postponing condition which has not yet arisen shall 
not be taken into consideration. 

Rights and encumbrances whose continuance depends on a dis- 
solving condition which has not yet arisen shall be treated as uncon- 
dit'onal. 

The provisions contained in paragra()lis 1 and 2 shall likewise be 
applied to rights and encumbrances dependent on an event which is 
uncertain only with regard to the time of its occurrence. 

Outstanding debts which can not be collected shall not be taken 
into consideration. 



24 



TAXING GOVERNMENT PROPERTY. 



(3) rAmit of taxation. 

Sec. 17. The followin*): persons shall not be 'obliged to pay the 
supplementary tax: 

1. Those whose taxable pro])erty does not exceed a total value of 
6,000 marks. 

2. Those whose income calculated according to the income-tax law 
does not exceed 900 marks a year, provided the total value of their 
taxable pro])erty does not amount to more than 20,000 marks. 

3. Women who have minor children to support, fatherless minor 
orphans, and persons inca})acitated to earn a living, provided the 
taxable pro])erty of these persons does not exceed the sum of 20,000 
marks and their yearly income calculated according to the income-tax 
law does not exceed 1,200 marks. 



III. Rates of Taxes. 

(1) Tax schedule. 
Sec. 18. The amount of the supplementary tax shall be as follows: 



With 






taxable 


Up to and 




property 


includ- 


Per year. 


of more 


ing- 




than— 






Marks. 


Marls. 


Marks. 


6,000 


8,000 


3 


8,000 


10,000 


4 


10,000 


12,000 


5 


12,000 


14,000 


6 


14,000 


16,000 


7 


16,000 


18,000 


8 


18,000 


20,000 


9 


20,000 


22,000 


10 


22,000 


24,000 


11 


24,000 


28,000 


12 


28,000 


32,000 


14 


32,000 


36,000 


16 


36,000 


40,000 


18 


40,000 


44,000 


20 


44,000 


48,000 


22 


48,000 


52,000 


24 


52,000 


56,000 


26 


56,000 


60,000 


28 


60,000 


70,000 


30 



In the case of liigher amounts of property, and uj) to 200,000 
marks, inclusive, the tax increases 5 marks for every additional 
10,000 marks or fraction thereof. 

In the case of estates amounting to more than 200,000 and uj) to 
and including 220,000 marks, the tax will amount to 100 marks, and 
for liigher estates it will increase 10 marks for every additional 
20,000 marks or fraction tliereof . 

(2) Consideration of special circumstances. 

Sec. 19. Persons whose property does not exceed 32,000 marks shall, 
if not assessed for tlie income tax, be obHged to pay a suj^plementary 
tax not to exceed 3 marks a year, and if they are assessed in the first 
four grades of the income tax they shall ])ay a supplementary tax 
not to exceed an amount which is 2 marks less than the income 
tax which the}^ pay. 



TAXING GOVERNMENT PROPERTY. 25 

Taxpayers who have had th.eir ijicome tax moderated on the basis 
of section 19 of the income-tax hiw may at assessment liave their 
su])})lemejitary tax moderated also by not exceeding two grades, 
provided their taxable pro])erty does not amount to more than 52,000 
marks. 

IV. Assessment. 

(1 ) Place and preparation of the assessment. 

Sec. 20. The assessment shall occur at the ])lace where the tax, 
payer is to be assessed for his income tax in accordance w^ith section 
20 of the income-tax law, or where he w^ould be assessed in case he 
were hable to ])ay an income tax. 

i\ll other necessary instructions in regard to the place of assess- 
ment shall be issued by the minister of finance. 

Sec. 21. The legal status of a person as taken (sec. 21 of the 
income-tax law) sliall at the same time serve for the assessment of 
the supplementary tax. 

Every communal council must extend the information prescribed 
to be gathered in section 23 of the income-tax law also to those points 
which may serve to form a judgment as to tlie extent and value of 
the taxable pro])erty, the result being handed in in a statement pre- 
pared according to rules to be issued by the minister of finance. 

(2) Assessment form alitifs. 

Sec. 22. The assessment of the tax])ayer shall take place simul- 
taneously with the asses:sment for the income tax, being attended to 
by the assessment board organized according to sections 33, 34, and 
50 of the income-tax law. 

Tliere shall not be any preliminary ai^rraisement made by the 
board of preliminary appraisements. 

Sec. 23. For every assessment district there sliall be formed an 
appraisement committee, to which shall belong: 

1. The president of the assessment board, or a substitute to be 
designated by him. 

2. At least four members, of whom two shall be permanent and 
shall be ap])ointed by the Government, tlie otliers being delegated 
by the assessment board from among its elected members (sul stitute 
members). 

For the ap])ointed and elected members tlie necessary number of 
substitutes shall be appointed and delegated in the same manner. 

The departure from the assessment board on the part of the mem- 
bers and substitutes delegated by the commission sliall also im))ly 
their departure from the appraisement committee. 

Sec. 24. Tlie ai)])raisement committee must make the necessary 
ascertainments of values for the ])urpose of assessing the tax] ayers, 
estimating the value of the taxable pro]^erty and esj)ecially of the 
real estate situated within the assessment district, as well as the 
capital invested in the establishment and operation of industries. 

For this pur])ose the committee shall receive all the information 
gathered by the president of tlie assessment board (sec. 25), the 
tax declarations handed in for the sake of assessing the income tax, 
the documents relating to these declarations, and the result of the 
income-tax assessment, and it shall be authorized to hear witnesses 
or summon them to attend its proceedixigs with a consulting voice. 



26 TAXING GOVERNMENT PROPERTY. 

The order of business of the ap]:'raisement committee shall be 
determined by the minister of finance. 

Sec. 25. The president of the assessment board, who at the same 
time represents the interests of tlie State, shall direct the business 
of assessment and shall be responsible for tlie carrying out of the 
whole avssessment in his district according to the existing regulations. 

For the sake of securing a correct assessment of the taxpayers the 
president shall, unless this has alread}' been done for the purpose of 
assessing the income tax (sec. 35, par 3, of the income-tax law), 
gather in as complete information as possible, including documents 
substantiating the value set for the various portions of estates. 

In this he may at his discretion require the cooperation of the 
communal councils, which shall be obliged to comply with, his requests. 
He shall be authorized to have the preliminary appraisement boards 
(sec. 31 of the income-tax law) give a special statement regarding 
the property of individual taxpayers. 

The president may, upon request or independentl}', afford the tax- 
payers an oj)portumty to have a personal interview regarding facts 
and conditions of imj^ortance to the assessment. 

All State and communal authorities and officials, except notaries, 
must permit an inspection of any books, ]:)apers. documents, etc., 
bearing on the proi^erty owned b}' the taxpayer, and upon request 
they shall be obliged to issue copies tliereof , unless special legal pro- 
visions or official reasons oppose. An inspection of the books, doc- 
uments, etc., of saving banks shall not be allowed. 

Sec. 26. For purposes of assessment, the taxpayers shall be 
entitled to state their taxable property to the president of the assess- 
ment board or to make such communications of facts as the assess- 
ment board may need in order to estimate the property (property 
declaration). 

In the case of persons who are under paternal authority, trustee- 
shi]), or guardianship their legal re]:)resentatives shall be authorized 
to make the declaration of pro])erty for tl:em. 

In the case of persons who are absent or hindered from giving their 
property declaration themselves, this may be done through attorneys. 

The declarations in regard to property must be given with the 
assurance that the statements are made to the best of the knowledge 
and belief of the parties. 

The periods and formalities to be observed in making property 
declarations shall be determined by the minister of finance. The 
necessary blanks shall be furnished free of charge. 

Sec. 27. The assistants assigned to the president for the elabora- 
tion of the income-tax data (sec. 37 of the income-tax law) may, 
according to the general instructions to be issued in this regard by the 
minister of finance, also participate in the elaboration of the data 
connected with the supplementary tax. 

Sec. 28. After obtaining the opuiion of the appraisement com- 
mittee, the president of the assessment board shall enter in the state- 
ment or tax list the property of each taxpayer which ought to be 
taxed, separated according to its component parts (sec. 4), propose 
the tax rate to be paid according to the provisions of this law, and 
lay the proceedings before the assessment board for action. 

Sec. 29. The assessment board shall subject the opinions of the 
appraisement committee, the property declarations received, and the 



TAXING GOVERNMENT PROPERTY. 27 

statements to a thorough examination. In this connection it shall be 
entitled to utilize itself also the means at the disposal of the president 
according to section 25 (pars. 3 to 5) and at the disposal of the 
appraisement committee according to section 24, and make other 
inquii'ies necessary in order to determine important facts. 

Sec. 30. If the statements contained in a property declaration 
regarding extent and value of a taxable estate are questioned by the 
assessment board or its president, notice must be given to the tax- 
payer as to the part of the estate or value which is questioned. As 
far as it is a question of statements regarding facts, the reasons of 
questioning them shall likewise be given. 

The notice should be accompanied by a demand that an explanation 
be given within a certain period regarding the questioned statements. 

Not unless the taxpayer fails to do this, or unless the doubts as to 
the correctness of the property declaration are not removed, shall the 
board be relieved of the obligation to observe the facts stated by the 
taxpayer in appraising his property. 

Sec. 31. The board shall fix the rate of tax which is proper in its 
judgment on the basis of the inquiries made. 

Sec. 32. The president of the assessment board shall make the 
result of the assessment known to the taxpayer in a communication 
also containmg instructions as to the legal remedy at his disposal in 
the way of appeal; if the assessment for the income tax has been made, 
the report thereon may be sent at the same time. (Sec. 39 of the 
income-tax law.) 

(3) Remedies at law. 

(a) Appeal. 

Sec. 33. Within an exclusive period of four weeks both the tax- 
payer and the president of the assessment board shall be entitled to 
appeal against the result of the assessment to the board of appeals 
organized according to sections 41 and 50 of the income-tax law. 

The provision contained in section 40 (par. 2) of the income-tax law 
shall be applicable, mutatis mutandis. 

If an appeal is made it may be embodied in the same document with 
an appeal made against the income-tax assessment. 

Sec. 34. The president of the board of appeals will have to assume 
the duties and exercise the same rights in regard to the supplementary 
tax as are assigned to him in section 42 of the income-tax law. 

Sec. 35. The board of appeals sliall decide all complaints and 
appeals brought against the procedure and decisions of tlie assess- 
ment boards and the appraisement committees. 

In examining the appeals the board of appeals and its president may 
have an accurate investigation made of the financial circumstances of 
the taxpayer. They shall be authorized m this connection to avail 
themselves of the means at the disposal of the assessment boards and 
their presidents for this purpose. (Sec. 25, pars. 3 to 5, sec. 29.) 

The assessment board and its president shall be further authorized 
to have witnesses and experts examined, and to have the testimony or 
opinion of the examined witnesses or experts confirmed under oath 
before the competent court. The persons to be examined sliaU not 
be allowed to decline to give the information except under the 



28 TAXING GOVERNMENT PEOPERTY. 

cii-cumstances which warrant the refusal to give testimony or an 
opinion according to the code of civil procedure. 

The assessment board shall carefully examine the property state- 
ments, and the memoranda derived therefrom shall be taken into 
account at the next assessment. (Sec. 37.) 

If the same taxpayer files a complaint against both his income-tax 
and his supplementary- tax assessment, the president may have the 
case discussed and decided in a single proceeding. 

(&) Complaint. 

Sec. 36. Both the taxpayer and the president of the assessment 
board shall have a right to file complaint against the decision of the 
assessment board before the superior administrative court in accord- 
ance with the provisions contained in section 44 of the income-tax law. 

If a taxpayer has also made a complaint in regard to the income- 
tax assessment, lie may file his complaint regarding his assessment of 
the supplementary tax in the same document. 

If the same taxpayer has filed complaint regarding both liis 
income-tax and his supplementary-tax assessment, the superior 
administrative court may discuss and decide both complaints in the 
same proceeding. 

In other respects tlie provisions of sections 44 to 49 of the income- 
tax law shall be applicable to the complaints and to the procedure 
followed in deciding them. 

V. Assessment Period and Change of Assessed Tax Within 

Said Period. 

Sec. 37. The assessment for tJ^e supplementary tax shaU be for a 
])eriod of tliree tax vears; however, tlie first time it sliall be onlv for 
the period from April 1, 1895, to March 31, 1896. 

For tiie period from April 1, 1896, to Marcli 31, 1899, the assess- 
ment period shall be fixed by royal order. 

Sec. 38. If during the course of a tax year there should be an 
increase of the taxable property in consequence of inheritance or 
acquisition of trust money, contract of partition or transfer between 
parents and c^'ildren, donation, or marriage, tlie acquiring party shall 
be further assessed for the supplementary tax according to the 
increase of !us property, and lie shall be obliged to pay the tax from 
the beginnino: of ihe montl' following t'n^ increase in property. 

Sec. 39. If it is proved that during the course of a tax year the 
total value of the taxable property of a taxpayer has been decreased 
by more than one-fourth as a result of the disappearance of a part 
of the estate, or that the disappearing part of the estate is assessed 
elsewhere for the supplementary tax, a demand may be made that 
the supplementary tax be moderated to a rate corresponding to the 
remainhig estate, this to take place from the beginning of the month 
following the date on which the decrease in the estate took place. 

Sec. 40. Except in the cases contemplated in sections 38 and 39, 
an increase or diminution in the amount or value of an estate occur- 
ring during the course of the assessment period shall not effect any 
change in the assessment alread}^ made; a change in the tax lists 



TAXING GOVERNMENT PROPERTY. 29 

shall take place within the assessment period only in consequence 
of accretions, where persons become liable to tax through acquisi- 
tion from other States of the federation or through other causes, or 
else in consequence of losses, where the conditions on which the 
liability to taxation depends disappear. 

Account shall be taken of the acquisition or loss from the begin- 
ning of the month following the date on which the liability to tax is 
incurred or disappears. 

Sec. 41. In regard to the procedure to be followed in the case of 
moderations of taxes (sec. 39) and when taxable property is lost, 
the provisions of section 60, paragraphs 1 to 3, of the income-tax 
law shall be appropriately applied. 

In the cases of sections 38 and 40, the president of the assessment 
board instead of the board itself shall determine the rate of tax to 
be paid as well as the date on which the property is to be considered 
as having been acquired. Otherwise the provisions of sections 20 to 
36 shall be applicable in regard to the assessment in cases of accre- 
tion and in regard to the legal remedies lying. 

It shall be the duty of the heads of communes to keep the lists of 
accretions and losses in accordance with orders to be issued by the 
minister of finance. 

VI. Collection of Taxes. 

Sec. 42. The supplementary tax shaU %e collected simultaneously 
with the income tax. 

Communes which are obliged to locally collect the income tax 
from incomes not over 3,000 marks shall also be obliged to collect the 
supplementary tax from persons assessed on an income of not more 
than 3,000 marks or who have remained free of income tax, and 
they shall receive therefor a fee to be determined by the minister of 
finance, provided the case contemplated in section 16, paragraph 2" 
of the law for the collection of direct State taxes has not arisen, this 
fee not to exceed 2 per cent of the net amount of supplementary tax 
collected. 

The provisions of sections 62 to 64 of the income-tax law shall 
likewise be applicable to the supplementary tax. 

Besides the assessed party, those persons whose property is attrib- 
uted to said party in the assessment according to section 5 shall be 
jointly liable for the part of the assessed supplementary tax which 
corresponds to said property according to the proportions to the 
total estate assessed. 

VII. Penal Provisions. 

Sec. 43. He who, for the purpose of evading the tax, makes 
incorrect or incomplete statements to the competent authorities 
regarding the taxable property to be charged to him or regarding 
the property of a taxpayer to be represented by him, shall be pun- 
ished by a fme amounting to from ten to twenty-five times the annual 
tax out of which the State has been or would be cheated; provided, 
however, that this fine shall not be less than 100 marks in any event. 



30 TAXING GOVERNMENT PEOPERTY. 

If an incorrect statement capable of reducing the tax has been 
made knowingly but still not with the mtention of evading the tax, 
a fine of 20 to 100 marks shall be imposed. 

He who, before he has been reported or an investigation has been 
begun, corrects or supplements an incorrect or incomplete state- 
ment and pays the withheld tax within the period set therefor and 
at the proper office, shall remain unpunished. 

Sec. 44. A tax which has been evaded shall be collected in addi- 
tion to and independently of the fine. 

The provisions of section 67, paragraphs 2 and 3, of the income- 
tax law shall be appropriately applicable. 

VIII. Final Provisions. 

Sec. 45. The communes (manor precincts) shaU bear the expenses 
of the business turned over to them in connection with the assess- 
ment of the supplementary tax. 

Otherwise the expenses of assessment and collection shall devolve 
upon the State treasury. However, the costs incident to the inquiries 
made in case of appeals or complauits shall be paid by tlie taxpayer 
if his statements are found to be incorrect in essential points. 

The costs to be paid shall be determined by the Government, against 
wliose decision the taxpayer may file an appeal before the mmister of 
finance within the exclusive period of four weeks. 

The members of the boaids and appraisement committee shall re- 
ceive from the State treasury their travelmg expenses and per diem, 
the rates being fixed b}" royal order according to section 12 of the law 
relating to the per diem and traveling expenses of State officials of 
March 24, 1873, Law Collection, page 122. (Art. I of the order of Apr. 
15, 1876, Law Coll., p. 107.) 

The fees for witnesses and experts (sees. 24 and 29) shall be 
reckoned accordmg to the provisions applicable in civil suits. 

Sec. 46. The following provisions of the mcome-tax law shall be 
appro])riately applicable : 

Sections 51 to 54, order of business of the boards and serving of 
notices. 

Section 55, supervision by the minister of finance. 

Section 61, paragraphs 1 and 2, notices and announcements. 

Section 68, paragraph 2, and section 69, punishment of violations 
of the duty to make announcements and maintain secrecy. 

Section 70, commutation of punishment and penal procedure. 

Section 78, competency of the director to administer the direct 
taxes in Berlin. 

Section 79, prolongation of the exclusive periods. 

Section 80, subsequent taxation. 

Section 81, barring by limitation. 

Sections 52, 69, and 80 are likewise appropriately applicable; pro- 
vided, however, that tlie statement of property shall be considered 
the same as the tax declaration and the taxable property the same as 
tlie income withm tlie meaning of this law, and furthermore that the 
provisions of section 52, paragraph 1, and section 69 shall also be 
ajjplicable to the members of the appraisement committee. (Sec. 23.) 



TAXING GOVERNMENT PKOPERTY. 31 

Sec. 47. Any person who has been prevented by occurrences of 
nature or otlier unavoidable events from observinf^ tlie periods pre- 
scribed for tlie filing of complaints or appeals in this law or tjic income- 
tax law may apply to have matters restored to their former state. It 
shall be considered as an unavoidable event if the apj)licant has failed 
to learn of the service of a notice through no fault of his own. 

The neglected complaint or appeal shall be filed subsequently 
within two weeks from tlie day on which the hindrance was removed; 
the facts on which the application for restoration is based being 
stated. 

After the expii-ation of a year from the end of the neglected period 
a subsequent appeal or application to restore matters to their original 
state can not be made. 

The applicant must in all cases bear the cash expenses incident to 
the consideration of the application to restore matters to their original 
state. 

Sec. 48. If the amount of assessment in 1895-96 exceeds 35,000,000 
marks by more than 5 per cent, all the tax rates provided in section 18 
shall be reduced in the ratio of the surplus to said amount. 

The reduction shall be expressed in appropriate round numbers by 
royal order. The rates determined in this order shall prevail for the 
tax year 1895-96 and the following years. 

Similarly, if the amount of assessment for 1895-96 falls below the 
sum of 35,000,000 marks by more than 5 per cent, there shall be a cor- 
responding increase in the rates of taxation fixed in section 18 of this 
law, unless the deficit is covered by the surplus of the income tax for 
1895-96 over and above 35,000,000 marks and by the mterest on 
the surpluses indicated in section 49. This Increase shall be abol- 
ished by royal order subsequently if the assessed amount of the sup- 
plementary tax attains 35,000,000 marks, plus an increase of 4 per 
cent for each year following 1895-96. 

Sec. 49. If the income tax for 1892-93 exceeds the sum of 80,000,- 
000 marks, and if it increases by 4 per cent for the following years, the 
surpluses and the interest thereon shall be set aside up to and including 
the fiscal year 1894-95 in the form of a fund to be administered by the 
minister of finance, unless otherwise provided by law. 

If the interest on this fund, computed at 3§ per cent on the amount 
thereof on April 1, 1895, is not used for the purpose mdicated in sec- 
tion 48, paragraph 3, of this law, it shall be disposed in the way of 
subsidiary assistance m building public schools or otherwise to impe- 
cunious scliool districts, according to provisions to be embodied in the 
national budget. 

The fund itself shaU be mcorporated in the general State fund on 
April 1, 1895. 

Sections 82 to 84 of the income-tax law shall go out of force upon 
the promulgation of this law. 

Sec. 50. Outside of the case contemplated in section 48, no change 
shall occur in the rates of the supplementary tax without a simultane- 
ous and proportionate modification of the income-tax rates. 

Sec. 51. In apportioning and collecting public burdens in the way 
of direct State taxes, the supplementary tax shall not be taken mto 
account. 

Sec. 52. This law shall take effect only simultaneously with the law 
for the levying of direct State taxes. 



32 



TAXING GOVERNMENT PBOPERTY. 



Sec. 53. The minister of finance is hereby charged with the enforce- 
ment of this law. 

Witness our own signature and royal seal affixed. 

Given at the New Palace, July 14, 1893. 

[l. s.] William. 

Ct. ZU EULENBURG. 
V. BOETTICHER. 
V. SCHELLING. 

Baron v. Berlepsch. 
Ct. V. Caprivi. 

MlQUEL. 

V. Kalterborn. 
V. Heyden. 
Thielen. 

BOSSE. 



Appendix. 



Table shoiving the actual capital represented by an annuity or revenue amounting to 
1 mark for a certain number of years, for the purpose of computing the supplementary 
taxes to be paid thereon. 

[See sec. 13, IV of the law.] 



Number of 

years. 



1 year.. 

2 years . 

3 years . 

4 years. 

5 years. 

6 years . 

7 years. 

8 years . 

9 years . 

10 years 

11 years 

12 years 

13 years 

14 years 

15 years 

16 years 

17 years 

18 years 

19 years 

20 years 

21 years 



sented 



Marks. 

1.000 

1.962 

2.886 

3.775 

4.630 

5.451 

6.242 

7.002 

7.733 

8.435 

9.111 

9.760 

10.385 

10. 986 

11.563 

12.118 

12.652 

13. 166 

13. 659 

14. 134 

14. 590 



Capital 
repre- 
sented. 



Number of Cjpit^l 
y«^^«- seXd. 









Marks. 


22 years 


15. 029 


23 years 


15.451 : 


24 years 


15.857 ■ 


25 years 


16. 247 


26 years 


16. 622 


27 years 


16.983 


28 years 


17.330 


29 years 


17.663 


30 years 


17.984 


31 vears 


18.290 


32 years 


18.589 


33 years 


18. 874 


34 years 


19. 148 


35 years 


19.411 


36 years 


19. 665 


37 years 


19.908 


38 j'ears 


20.143 


39 years 


20.368 


40 j-ears 


20.585 


41 vears 


20.793 


42 years 


20.993 





Marks. 


43 years 


21.186 


44 years 


21.371 


45 years 


21.549 


46 years 


21.720 


47 years 


21.885 


48 years 


22.043 


49 years 


22. 195 


50 years 


22.342 


51 j-ears 


22.482 


52 years 


22.618 


53 years 


22.748 


54 years 


22. 873 


55 vears 


22.993 


56 years 


23.109 


57 years 


23. 220 


58 years 


23.327 


59 years 


23.430 


60 years 


23.528 


61 years 


23.624 


62 years 


23.715 


63 years 


23.803 



Number of 
years. 



64 years. 

65 years. 

66 years. 

67 years. 

68 years. 

69 years. 

70 years. 

71 years. 

72 years. 

73 years. 

74 years. 

75 years. 

76 years. 

77 years. 

78 years. 

79 years. 

80 years. 

81 years. 

82 years. 

83 years. 

84 years 1 



Capital 
repre- 



Marks. 
23.887 
23.969 
24.047 
24.122 
24.194 
24.264 
24.330 
24.395 
24.456 
24.516 
24.573 
24.628 
24.680 
24. 731 
24.780 
24.827 
24. 872 
24. 915 
24. 957 
24.997 
25.000 



1 And over. 

(No. 9629.) COMMUNAL TAX LAW OF JULY 14, 1893. 

We, WiUiam, by grace of God, King of Prussia, etc., hereb}" order, 
with the consent of both houses of the diet of our monarchy for the 
extent thereof, with the exception of the Ilohenzollern lands and the 
island of Helgoland, as follows: 

Part I. — Communal Taxes. 



First Title. — General provisions. 

Sec. 1 . The communes shall be entitled, for the purpose of covering 
their expenses and needs, to levy fees, contributions, indirect and 
direct taxes, and services in kind, all in accordance with the provisions 
of this law. 



TAXING GOVERNMENT PROPERTY. 33 

Sec. 2. The communes shall utilize the authority to collect taxes 
only to sucli an extent as their otlier recei])ts do not suffice, especially 
those from the communal domain, fees, contributions, and means 
assigned by the State or other communal districts to tiie commimes 
to cover their expenses. This provision is not applicable to dog, 
amusement, and other similar taxes necessitated by special con- 
siderations. 

Only tlie amount required after deducting the proceeds of the 
indirect taxes from the total amount of taxes required shall be 
obtained by direct taxes. 

Sec. 3. Industrial enterprises of the communes shall as a rule 
be so administered that at least all th.e expenses accruing to the 
commune from the enterprise (including interest and amortization 
of the capital invested) sliall be obtained. 

An exception sJiall be permitted if the enterprise at the same 
time serves a public interest which is not otherwise satisfied. 

Part II. — Fees and Contributions. 

Sec. 4. Tlie communes may levy special fees for the use of in- 
stitutions maintained by them for the j^ublic interest. 

Fees shall be collected when the institution redounds particularly 
to the benefit of certain members of the commune or certain classes 
and provided an equalization is not effected through contributions 
(sec. 9) or an increase or decrease of taxation. (Sec. 20.) The rates 
of fees shall as a rule be such as to cover the expenses of administra- 
tion and maintenance of the institution, including expenditures in 
interest and amortization of the capital invested. 

If it is compulsory for all tlie members of a commune or certain 
classes thereof to make use of an institution, or if they are dependent 
on the institution, a due moderation of the fees shall be permissible, 
taking into consideration the public interest wliicli the institution 
serves. The collection of fees may even be abolished in cases of this 
kind. 

The foregoing provisions (pars. 2 and 3) shall not be applicable to 
institutions of learning and education, hospitals, sanitariums, and the 
like, or to any institutions specially serving the needs of the poorer 
classes. However, an appropriate tuition fee shall be cliarged for 
attendance at higher institutions of learning and special scliools 
maintained by the communes. 

Otlier. departures from the mode of determining fees prescribed 
in paragraph 2 shall be allowed only for special reasons. 

There shall not be any compulsory levying of highway, street, 
pavement, and bridge tolls. 

Sec. 5. The existing regulations regarding the granting of the 
right to levy highway, street, pavement, bridge, ferry, liarbor, and 
sluice tolls or dues and other similar traffic charges, as well as regarding 
the determination of the schedules of rates thereof, shall not be 
affected by this law. 

Sec. 6. Communes, amtsbezirke, amter, and country mayoralties 
shall be entitled to collect fees for the approval and supervision of 
new buildings, remodeling of buildings, and other structural works, 

S. Doc. 163, 63-1 3 



34 TAXING GOVERNMENT PROPERTY. 

as well as for the maintenance of order in and guarding against fire 
of fairs and markets, and from musical entertainments, spectacular 
productions, theatrical performances, and other amusements. If 
taxes are collected from amusements, fees shall not be charged for 
theii* supervision. 

In other respects the existing provisions shaU govern in regard to 
the authority of communes to coUect (administrative) fees for 
particular acts of their organs. 

The amount of the fees must be such that the proceeds therefrom 
shall not exceed the cost of the branch of administration in question. 

Sec. 7. Fees must be determined in advance according to fixed 
standards and rates. It shall be permissible to make exceptions in 
favor of poor persons. 

Sec. 8. In the cases of section 4 (pars. 3 and 5) and section 6, the 
fixing of the fees shaU require approval. 

The requiiement that tuition fees be approved by the school 
supervisory authority shaU not be affected. 

Sec. 9. In order to cover the cost of establishing and maintaining 
institutions required by public interest, the communes may collect 
contributions toward the cost of the institutions from property 
owners and operators of industries who would derive considerable 
economic advantages therefrom. These contributions shall vary 
in amount according to the benefit derived. 

Contributions should as a rule be collected if the cost, including 
expenditures in interest and amortization of the capital, would 
otherwise have to be raised by means of taxes 

The plan of the institution, together with a statement of the cost, 
shall be made pubUc. The decision of the commune to collect con- 
tributions shall be pubhshed in the usual manner, together with a 
statement as to where and during what time the plan and statement 
of cost will be open to inspection, the remark being likewise made 
that any objections against the decision must be filed %vith the com- 
munal council within a fixed period of four weeks. If it is a case of an 
institution which affects only certain landowners or operators of 
industries, it will be sufficient to send a notice to the interested 

Earties instead of making the publication. The decision wiU have to 
e approved. 

For this purpose the communal council shall deliver to the com- 
petent authority the decision, together with the preliminary proceed- 
ings pertaining thereto and a statement as to what, if any, objections 
have been filed within the period set. 

The decision of the competent authority shall be made known in 
the same manner to tlie interested parties as the decision of the 
commune was made known. 

The interested parties shall have a right to file complaint against 
the decision of the competent authority. 

Sec. 10. The provisions of the law relating to tl o estabUshment and 
change of streets and squares in cities and country towns, of July 2, 
1.S75 (Law Coll., p. 561), shall remain in force, but with the under- 
standing that the contributions prescribed in section 15 thereof may 
be calculated according to a different standard than that indicated 
therein, it being particularly permissible to calculate it according to 
the area capable of being built on. 



TAXING GOVEKNMENT PROPERTY. 35 

Sec. 11. The provisions of the law relating to the levying of fees for 
market space, of April 26, 1872 (Law Coll., p. 513), shall remain 
intact. 

The provisions of the laws on the erection of public slaughter- 
houses of March 18, 1868 (Law Coll., p. 277) and March 9, 1881 (Law 
Coll., p. 273), shall likewise remain in force. However, fees may be 
collected for the use of the slaughterhouses to such an amount that 
the annual proceeds therefrom shall cover the cost of maintaining 
and operating the estabhshment besides 8 per cent of the investment 
capital and of whatever remuneration may have been paid. 

In cities in which excise taxes are levied on meat, the fees for using 
the slaughterhouses shall only be high enough to yield a sum equal 
to 5 per cent of the invested capital and the remuneration, besides 
the cost of maintenance and operation. 

The fees for the inspection of meat not killed in public slaughter- 
houses (art. 1, sec. 2, Nos. 2 and 3 of the law of Mar. 9, 1881) may be 
calculated at an amount corresponding to the fees for the utilization 
of the slaughterhouse. 

Sec. 12. At bathing, climatic, and other health resorts the com- 
munes may collect compensation (tax) for the establishment and 
maintenance of the arrangements made by them for therapeutic 
purposes. 

Part III. — Communal Taxes. 

First section. — Indirect communal taxes. 

Sec. 13. The communes are authorized to collect indirect taxes 
within the limits set by the imperial laws. 

The communes shall be permitted to make agreements with the 
interested parties whereby the annual amount of the indirect taxes 
to be paid shall be determined in advance for several years. These 
agreements shall be subject to approval. 

Sec. 14. Taxes on the consumption of meat, grain, flour, pastry, 
potatoes, and fuels of any kind shall not be introduced originally or 
increased in their rates. However, it shall be permissible to intro- 
duce a tax on game and poultry even in communes which did not 
formerly levy a grinding and slaughter tax. The rates may be fixed 
differently than prescribed by the order of April 24, 1848. (Law 
Coll., p. 131.) 

Sec. 15. The communes shall be allowed to tax amusements, in- 
cluding musicales and declamations and the performances of traveling 
artists. 

Sec. 16. The communes are authorized to tax the keeping of dogs 
(sec. 93). The legal provisions existing in this regard at present are 
hereby repealed. 

Sec. 17. The existing regulations regarding the use of the pro- 
ceeds of indirect taxes for certain purposes (cost of keeping the poor, 
etc.) are hereby repealed. 

Sec. 18. The introduction of new and the change of existing 
indirect communal taxes can take place only through tax ordinances. 

These tax ordinances shall be subject to approval. 

Sec. 19. The existing regulations shall continue to govern regarding 
the exemption of military eating houses and similar military estab- 
lishments. 



36 TAXING GOVERNMENT PROPERTY. 

Second section. — Direct communal taxes. 
I. general provisions. 

Sec. 20. Tlie dii-ect communal taxes shall be distributed among 
all the taxpayei-s according to fixed and uniform principles. 

If it is a question of institutions which benefit to a specially large 
or small extent some particular part of the communal district or a 
particular class of the inhabitants of the conunune, and if contribu- 
tions accordmg to sections 9 and 10 are not collected, the commune 
may resolve to levy a larger or smaller tax on such part of the com- 
munal district or such class of uihabitants of the commune. In 
determinmg the increase or decrease in taxation, the amount required 
to establish and mamtain the institutions after deducting whatever 

Erofits they may peld shall be taken as a basis. The resolution shall 
e subject to approval. 

Sec. 21. Tlie exemptions of individual pieces of real estate from 
communal taxes based on special legal titles shall continue in their 
former amount. The communes shall nevertheless be entitled to 
redeem these exemptions by payment of 20 times the annual 
value thereof accordmg to the average of the last three years before 
April 1 of the fiscal year in which the redemption is resolved upon. 
If there is any other standard of compensation, it shall govern. 

Sec. 22. Provisions which involve an exemption from industrial 
tax shall not be applicable to industries which go mto operation after 
the promulgation of this law. 

The communes shall be entitled to redeem the existmg exemptions 
by paymg 13 J times the annual value thereof according to the average 
of the last three years before April 1 of the fiscal year in which the 
redemption has been resolved upon. If there is any other standard of 
compensation, it shall govern. 

Sec. 23. The direct communal taxes may be collected from the real 
estate and inchistry (property taxes) as well as from the income of 
the taxpayer (income tax). 

The income tax may be superseded in part by means of sumptuary 
taxes. Sumptuary taxes should not as a rule burden small incomes 
comparatively heavier than large mcomes. 

No new rent and dwelling taxes shall be introduced. 

The existing rent and dwelling taxes shall be tested as to their 
consistency with the foregoing principles of taxation and the other 
provisions of this law. They shall require renewed approval, subject 
to the consent of the ministers of the interior and fuiance, and shall 
go out of force if the approval is not given b}' April 1, 1898. 

The introduction of new and the change of existing direct com- 
munal taxes which are not levied in percentages of the taxes assessed 
by the State shall only take place through tax ordinances. 

The tax ordinances shall require approval. 



TAXING GOVERNMENT PROPERTY. 37 

II. SPECIAL PROVISIONS. 

(1) Ppoperty Taxes. 
(a) Real Estate. 

Sec. 24. All parcels of land, containing buildings or not, which are 
situated in the commune shall . e subject to the real estate tax 
except : 

{a) The royal castles, including the outbuildings belonging thereto 
and the yards and gardens. 

(6) Lots belonging to a foreign nation and on which embassies or 
legations are built, including the buildings erected thereon, provided 
the foreign nation grants reciprocity. 

(c) Lands and buildings belonging to the State, the provinces, the 
kreise, the communes, or communal districts, provided they are 
intended for some public service or use. 

{d) Bridges, highways, rights of way of railroads, and navigable 
canals which have been established for public use with the approval 
of the State. 

{e) Dikes of the dike companies and private dikes placed under 
inspection by the State in the public interest, as well as the estab- 
lishments of the irrigation and drainage companies maintained in the 
public interest. 

(/) University buildings and other buildings devoted to public 
instruction. 

{g) Churches, chapels, and other buildings devoted to divine serv- 
ices, as well as the religious-service buildings of religious societies pos- 
sessing corporative rights. 

(h) Poorhouses, orphan asylums, and public hospitals, prisons, 
infant asylums, and those charitable institutions vrhose purpose is to 
guard against lack of protection or moral danger (girls' asylums and 
the like), as well as buildings which belong to charitable endowments 
and are used directly for their purposes; through resolution of the 
commune other buildings of such charitable endowments as do not 
exist merely for the sake of certain persons or families may also be 
exempted. 

(i) The grounds belonging to the institutions and bodies men- 
tioned under (/), {g), and (li), provided the grounds are used directly 
for their purposes. 

(k) The official lands and dwellings of clergymen, sextons, and 
public-school teachers, provided exemption from tax has been granted 
to them hitherto. 

All other exemptions which are not based on a special legal title 
(sec. 21), especially including those of the official premises and 
dwellings of officials, are abolished. 

If only a part of a piece of land or building is devoted to public serv- 
ice or use, the exemption shall extend only to the part concerned. 

The provisions of the cabinet order of June 8, 1834 (Law Coll., p. 87), 
shall remain in force and shall be extended to those communes in 
which they are not yet in force. 

Sec. 25. The communes shall be permitted to introduce special real 
estate taxes. 

Reapportionments may be made on the basis of the net revenue or 
usufructuary value for one or several years, of the leasing or rental 



38 TAXING GOVEKNMENT PROPERTY. 

value, or of the common value of the lands and buildings, according 
to the gradations of real estate occurring in the commune, or on the 
basis of a combination of several of these standards. 

Sec. 26. If no special real estate taxes have been introduced, the 
taxation shall be in percentages of the land and building taxes as- 
sessed by the State. 

An increase or reduction of the assessed tax brought about in con- 
sequence of a complaint or appeal shall entail a corresponding modi- 
fication of the assessment for the communal tax. 

The assessment shall extend to all lands and buildings which are 
subject to communal taxation. (Sees. 3 and 4 of the law on the abo- 
lition of direct State taxes.) 

The taxation of newly constructed or thoroughly remodeled build- 
ings, as well as increases in tax OA\ing to the improvement of buildings, 
shall begin after the expiration of the fiscal year in which the building 
has become ready for habitation or use or the improvement has been 
completed. 

Sec. 27. The taxes on real estate shall be apportioned according to 
uniform rules and rates. 

Premises whose value has been enhanced by the establishment of 
building-front lines (building sites) may be assessed a higher rate of 
tax on the basis of this increased value than other lands. This taxa- 
tion must be regulated by a tax ordinance. 

(6) Operation of industries. 

Sec. 28. The following shall be subject to industrial taxes in the 
commune in which the industry is situated: 

1 . Permanent industries to be assessed according to the industrial- 
tax law of June 24, 1891. (Law Coll., p. 205.) 

2. Agricultural brandy distilleries. 

3. Mining. 

4. The industrial production of amber and the exploitation of peat 
bogs, of sand, gravel, loam, marl, clay, and similar pits, and of stone, 
slate, lime, chalk, and similar quarries. 

5. The industries operated by communal and other public com- 
panies. 

6. The industries operated by the State and by the Imperial bank. 
Those industries indicated under Xos. 2 to 6 and in which neither 

the annual proceeds reach 1,500 marks nor the fundamental and 
operative capital 3,000 marks, as well as the industries operated by 
tne communal companies and exempt from tax according to section 3, 
No. 4 of the industrial-tax law of June 24, 1891, shall remain free from 
the industrial tax. This provision shall not be applicable to the tax 
on operation. 

The operation of State railroads and of those private railroads which 
are subject to the railroad tax shall be exempt from the industrial 
tax. 

The carrying on of itinerant industry shall not be subject to the 
industrial tax in the communes. 

Sec. 29. The communes shall be permitted to introduce special 
industrial taxes. 

The industrial taxes may particularly be calculated according to 
the proceeds of the last year or series of years, according to the value 



TAXING GOVEKNMENT PEOPERTY. 39 

of the capital invested in the establishment of the industry or of that 
invested both in the establishment and operation of the industry, ac- 
cording to other evidence indicative of the extent of the industry, or 
according to a combination of several of these standards. 

Sec. 30. If no special industrial taxes have been introduced, the 
taxation shall take place in percentages of the industrial tax assessed 
by the State. 

An increase or reduction of the assessed industrial tax brought 
about in consequence of a complaint or appeal shall entail a corre- 
sponding modification of the communal tax. 

The assessment shall extend to all industries, including mining, 
which are subject to communal taxation. (Sees. 3 and 4 of the law 
abolishing direct State taxes.) 

Sec. 31. a dift'erent gradation of the rates and percentages of in- 
dustrial tax shall be permissible: 

1. If the individual branches of industry derive different degrees 
of benefit from the communal institutions or cause the commune 
different amounts of expenses and provided no equalization is made 
according to sections 4, 9, 10, or 20. 

2. If the industrial buildings are assessed a heavier tax than would 
be the case on the basis of the State building tax, or if the spaces 
utilized for industrial purposes are subject to a rent tax. 

The different gradations shall require approval. 

Sec. 24. If an industry extends to several communal districts, the 
competent tax committee shall, in case of the collection of percentages 
of the assessed industrial tax, have the rate of total tax divided into 
the proportionate sums corresponding to the individual communes, 
even in the case of the industries designated in section 28, Nos. 2 to 6. 
(Sec. 38 of the industrial-tax law of June 24, 1891.) 

If special industrial taxes are reapportioned, the assessment should 
take place only in proportion to the part of the industry situated 
within the commune, and in the case of special industrial taxes ac- 
cording to the earnings, the provisions contained in sections 47 and 48 
of this law being appropriately applicable. 

[(2) Communal Income Tax, 

(d) Liability to taxation. 

Sec. 33. The following shall be liable to the communal income tax: 

1. Persons who have a residence in the commune (sec. 1 of the 
income-tax law of June 24, 1891, Law Coll., p. 175), ^^'ith respect to 
their total income obtained within and without the Prussian State 
territory, unless this income is to be exempted from taxation. 

2. Persons who, while not having a residence in the commune, 
own real estate or commercial or industrial establishments (including 
mines), carry on commerce or industry or (outside a trades-union) 
mining, or are connected with the establishment of a limited-liability 
company as a partner thereof, with respect to the income accruing 
to them from this source within the commune. 

3. Stock companies, limited-liability share companies, mining 
companies, registered unions, whose business extends beyond the 
circle of their members (especially cooperative societies with stores 
open to the public), and corporations (including particularly com- 
munes and communal districts), which have real estate or com- 



40 TAXING GOVEKNMElSrT PROPERTY. 

mercial or industrial establishments (including mines) within the 
commune, carry on commerce or industry (including mining), or are 
connected as partners mth the establishment of a limited-liability 
company, with respect to the income accruing to them from these 
sources within the commune. 

4. The State treasury with respect to its income from the railroad, 
mining, and other industrial enterprises operated by it, as well as 
from domains and forests. 

Railroad stock companies which have turned over their enter- 
prise to the State in consideration of an income payable directly to the 
stockholders are not to be considered as owners of railroads. 

Every parcel of land subject to taxation and every taxable enter- 
prise of the State treasury shall be considered as an independent 
person as regards the liabilit}^ to taxation. All State railroads and 
those operated on account of the State are to be regarded as taxable 
enterprises. Moreover, the proper superior administrative authority 
shall determine what is to be regarded as an independent minmg 
enterprise or other industrial enterprise of the State treasury. 

New settlers, even though they have no residence in the commune, 
may be compelled to pay taxes the same as the other residents of the 
commune, provided their sojourn exceeds a duration of three months. 

Sec. 34. Income from lands with or without buildings and which 
are wholly or partially exempt from the real estate tax according to 
section 24, shall be exempt to the same extent from the communal 
income tax. 

Sec. 35. There shall be a taxable operation of commerce or industry 
(including mining) on the part of the persons and business associa- 
tions mentioned in section 33, Nos. 2, 3, and 4, only in the communes 
in which is situated the headquarters, a branch establishment, a 
working or sales office, or an agency of the enterprise empowered to 
transact legal business independently in the name and on account of 
the owner or association. The operation of a railroad shall be subject 
to taxation in the communes in which is located the seat of adminis- 
tration (or, as the case may be, a State railroad administrative author- 
ity), a station, or an independent workshop or similar establishment. 

The income arising from the ownership of commercial and indus- 
trial establishments (including mines) in cases when the owner does 
not operate them himself shall be subject to taxation in the same 
communes in wh'ch the income from the operation is taxable. 

Sec. 36. Without prejudice to the provisions of section 23 (par. 2) 
and of the provisions regarding the assessment of partial incomes 
(sees. 49 to 51), communal taxes on incomes may only be collected 
on the basis of the assessment for the State income tax and as a rule 
only in the form of additional charges. These additional charges 
must be uniform. Additional charges in connection with the sup- 
plementary tax are not permissible. 

If an income subject to communal taxation has failed wholly or in 
part to be assessed for the State income tax, the rate of taxation to 
be taken as the basis for the additional charge shall, unless some 
other method is prescribed by sections 44 to 46, be determined 
according to the provisions governing the assessment of the State 
income tax. 

An increase or reduction of the assessed State income tax occurring 
as a result of the filing of a complaint or appeal or on the basis of sec- 



TAXING GOVERNMENT PROPERTY. 41 

tions 57 and 58 of the income-tax law of June 24, 1891, shall entail a 
corresponding modification of the additional charge levied by the 
commune. 

Sec. 37. Special communal income taxes shall be permissible only 
for special reasons and shall require approval. The determination 
of the income on which is based the assessment of the State income 
tax, and the gradations of the tax schedule of the State income tax, 
shall not be modified. Modifications of the rates of the tax schedule 
shall only be permissible in such a way that the percentage of taxation 
of the income in the lower grades shall not be any higher than in the 
higher grades, and that the ratio of increase of the rates contained 
in the schedule of the State income tax shall not be changed to the 
detriment of the higher grades. 

The retention of existing special communal income taxes may by 
way of exception, for special reasons, and with the consent of the 
ministers of the interior and finance be approved even if these taxes 
do not agree with the provisions of paragraph 1. 

The provisions of section 36, paragraphs 2 and 3, are appropriately 
applicable to the special communal income taxes. 

Sec. 38. Unless otherwise provided in the tax ordinances (sec. 23, 
pars. 5 and 37), taxpayers with an income of not more than QOOmarks 
shall be assessed for the income tax according to the following rates; 

1. If their income is not over 420 marks, at the rate of two-fifths 
per cent of the taxable income up to a maximum rate of 1.20 marks . 

2. If their income is over 420 and not over 660 marks, at the rate 
of 2.40 marks. 

3. If their income is over 660 marks, at the rate of 4 marks. 

If the satisfaction of the needs of the commune is assured at all 
events, taxpayers with an income not exceeding 900 marks may by 
resolution of the commune be relieved of the obligation of contributing 
or be assessed at a lower percentage rate. The resolution shall 
require approval. They must be exempted if they receive continual 
assistance as paupers. 

Sec. 39. Foreigners and citizens of other States of the federation 
who have a residence in. the commune but not for business purposes 
may, by resolution of the commune, have their communal income 
tax remitted or reduced to a lower percentage for a maximum period 
of three years. 

The resolution in this regard shall require approval. 

Sec. 40. The following shall be exempt from the communal tax: 

1. The members of the royal household and of the Ilohenzollern 
house of princes. 

2. The representatives of foreign powers accredited to the Emperor 
and King and the plenipotentiaries of other States of the federation 
to the federal council, the officials attached to them, as well as persons 
in their service and that of their officials, if these persons are 
foreigners. 

3. Other persons who have claim to exemption according to the 
principles of international law or special agreements concluded with 
other nations. 

The exemptions under Nos. 2 and 3 do not extend to the income 
designated in section 33, No. 2, and they shall not exist unless reci- 
procity is granted in the nations concerned. 

The existing legal provisions according to which barons and their 
families are exempted from communal taxes shall remain intact, 



42 TAXING GOVERNMENT PROPERTY. 

without prejudice to the provisions contained in sections 21 and 22 
of the present law. 

Sec. 41. The levying of income and sumptuary taxes (sec. 23) on 
immediate and mediate State officials, officials of the royal court, 
clergymen, church servants, and teachers in elementary schools, as 
well as the widows and orphans of these persons, shall be regulated 
by a special law. Until such a law is passed the provisions of the 
ordinance relating to the imposition oi communal taxes on State 
officials in the newly acquired provinces, of September 23, 1867 
(Law Coll., p. 1648), shall be applicable with the understanding that 
the necessary domicile shall be left out of account. 

Spc. 42. With respect to the lev3^ing of communal income taxes 
on military persons, the existing regulations shall govern. 

The members of the gendarmery shall be considered as military 
persons within the meaning of this law. 

Sec. 43. The communes shall be permitted to conclude agreements 
with taxpayers according to which a fixed annual tax, to be deter- 
mined for several years in advance, shall be paid b}^ manufacturing 
enterprises and mines instead of the communal income and industrial 
tax. These agreements shall require approval. 

(6) Calculation of the taxable income from domains and State and private railroads. 

Sec. 44. The net income from fiscal domains and forests shall be 
calculated for the various estates on the basis of the net proceeds of 
the land tax in the proportion in which, in the Province concerned, the 
budgetary surplus of receipts over expenditures as obtained from the 
domanial and forest lands stands to the net proceeds of the land tax, 
taking into consideration the liens thereon and the expenses of 
administration. 

The proportion shall be definitely fixed each year by the proper 
minister and made public. 

Sec. 45. The net income of the railroads owned by or operated on 
account of the State shall be the surplus (as appearing from the 
accounts) of the receipts over the expenditures, provided that 3i 
per cent interest on the originally invested or business capital accord- 
mg to the official statistics of the railroads in operation shall be 
included among the expenditures. The total taxable amount 
derived in this manner shall be definitel}^ fixed each year by the 
proper minister and made public. 

Sec. 46. The net income of the private railroad enterprises shall be 
the surplus ascertained (or to be ascertained) for each railroad, for 
the purpose of collecting the railroad tax, according to the provisions 
of the laws of ^fay 30, 1853 (Law Coll., p. 449), and March 16, 1867 
(Law Coll., p. 465), the railroad tax being first deducted; provided, 
however, that in making the calculation according to the law of 
March 16, 1867, the amounts which may be required in order to pay 
the interest and re.^rular amortization of any loans contracted ma}^ be 
included in the calculation as expenditures. The taxable amounts 
thus asceitained shall be definitely fixed by the State authorities 
intrusted with the supervision of the private railroad enterprises and 
made public. 

The foregoing provision shall not be applicable to narrow-gauge 
railroads. (Law of Julv 28, 1892— Law Coll., p. 225.) 



TAXING GOVERNMENT PKOPERTY. 43 

(c) Avoidance of double taxation. 

Sec. 47. Unless another method has been agreed upon between the 
communes concerned and the taxpayers, the distribution of the tax- 
able income arising from the possession or operation of an industrial 
or mining enterprise extending over several Prussian communes shall 
take place as follows : 

(a) In the case of insurance, banking, and loan concerns of the 
commune in which the v^hole enterprise is directed, in such a manner 
that one-tenth of the whole income shall be assigned to begin with, 
the remainder bemg distributed in proportion to the gross receipts in 
the individual communes. 

(6) In other cases in such a manner that the proportion of the 
expenditures in the individual communes in the way of salaries and 
wages (including the shares of profits due the administrative and 
operative force) shall be taken as a basis. However, in the case of 
railroads the salaries, shares of profits, and wages of the staff employed 
in the geneial administration shall be assessed only to thv3 extent of 
one-half of their amount, while the amount taken as the basis in the 
case of the force employed in the administration of the workshops 
and the traffic service shall be two-thirds. 

If an operating establishment, station, or the like within which ex- 
penditures in salaries and wages are incurred extends over several 
communes, the distribution shall take place according to the local 
circumstances, taking into consideration the area occupied and the 
amount of communal taxes accruing to the interested communes 
through the presence of the operating establishment, station, etc. 

In the cases of the railroads owned by and administered on account 
of the State, one third of the whole net income of these railroads 
taxable according to section 36 shall, up to April 1, 1896, be assigned 
to begin with to the communes which were entitled to collect taxes 
before April 1, 1880, and which actually exercised this right, for dis- 
tribution according to the proportion of the average of the three 
taxation years preceding April 1, 1880, to the net amounts assessed 
for the communal taxes. On and after April 1, 1896, the distribution 
shall take place according to the rules set forth untler h in the case 
of all commimes entitled to collect taxes. 

Sec. 48. The gross receipts of insurance, banking, and loan con- 
cerns, as well as their ex])enditures in salaries and wages (sec. 47) 
shaU be ascertained by taking a three years' average based on the 
examination of a plan of distribution to be communicated annually 
by the owner of the concern or the board of directors of the company 
to the communes entitled to collect the tax. This plan shall be pre- 
pared for each directorate district in the case of the State railroads. 
(Sec. 45.) 

Sec. 49. In assessing the taxpayers for the income tax in the com- 
munes of their residence, the part of the total income derived in other 
Prussian communes from real estate or commercial or industrial estab- 
lishments (including mines), from the carrying on of commerce or 
industry (including mining), and from the participation in founding 
a limited- liability company (sec. 33, No. 2), shall, without preju- 
dice to the provisions of section 35, be left out of account. For this 
purpose the total income of the taxpayer shall be estimated and the 



44 TAXING GOVERNMENT PROPERTY. 

taxable amoimt thus obtained shall be reduced according to the pro- 
portion of the income to be left out of account to the total income. 

However, if the taxable income amounts to less than one fourth 
of the total income, the commune in which the taxpayer resides 
shall be entitled to adopt a communal resolution to the effect that a 
full quarter of the total income shall be taxed })v it, the amount of 
income taxable in one or more outside communes being correspond- 
inojly curtailed. If several communes of residence are entitled to 
take this measure, the fraction shall be distributed according to 
section 50. 

Sec. 50. When the income of persons having a residence in several 
communes within the State of Prussia is estimated in the communes 
of their residence, the part of the income flowing from real estate oi 
commercial or industrial establishments (including mines), from 
commerce or industry (including mining), or from the participation 
in the foundation of a limited liability company (sec. 33, Xo. 2), shall 
be considered to belong to the commune where the property or indus- 
try is situated. If, however, this part of the income amounts to over 
three-fourths of the total income of the taxpayer, the provision of 
section 49, paragraph 2, of this law shall be appropriately applicable. 

New settlers who are assessed for communal taxes owing to their 
sojourn within the commune for over three months (sec. 33, par. 4) 
shall in this respect be treated equally with those who have their 
residence in the commune. 

Otheiwise, persons with several residences shall be assessed in each 
Prussian commune of residence only on a fraction of theii* iuv^ome 
corresponding to the number of their communes of residence. For 
this ]:)urpose the rate of taxation calculated for the total income shall 
be equably distributed among the communes of residence according 
to their number. Communes of residence in which the taxpayer has 
resided less than three months or not at all during the preceding fiscal 
year shall not be included in this calculation. 

Sec. 51. If the total income of a taxpayer subject to the State 
income tax is taxable in parts in several Prussian communes, the 
income taxable in tliese communes shall not altogether exceed the 
maximum amount of the grade of taxation in which the tax]^ayer 
was appraised upon being assessed for the State income tax. For this 
pur])ose the parts of the income shall be proportionately reduced 
(sees. 71 to 74), provided they continue as a whole to exceed the 
maximum grade after being rectified. 

If the taxpayer has several sources of income in one commune, 
they shall be considered as one for j^urposes of taxation in the 
commune. 

(3) Obligation on the Part of Industrial Communes to Pay Contributory 

Allowances. 

Sec. 53. If a commune not enjoying a right of taxation according 
to section 35 is proved to incur additional expenses for purposes of 
public schools or pauper maintenance owning to the operation of 
mines, smelteries, salt works, factories, or railroads in another com- 
mune, and if these additional expenses are considerable in proportion 
to the expenses of the commune for these purposes without the said 
industries and are likely to cause an overburdening of the taxpayers, 



TAXING GOVERNMENT PROPERTY. 45 

such commune shall be entitled to demand an appropriate contribu- 
tory allowance from the commune where the industry or industries are 
situated. In calculating the amount of this allowance, not only the 
increase in expenses but also the advantages which can be proved to 
have accrued to the commune shall be considered. The contributory 
allowances made by the commune where the industries are situated 
shall in no event amount to more than half the total direct communal 
taxes to be collected from the industries concerned. 

If the industry is situated in a manor precinct, the claim shall be 
made of the operator of the industry; in this case the contributory 
allowance shall not exceed the full rate of the industrial tax as 
assessed by the State. 

In cases in which no agreement is reached among the interested 
parties, the kreis committee shall decide in regard to the claim, and 
as far as the city of Berlin or other city communes are concerned the 
district committee shall decide. Against the decision a request may 
be filed within two weeks for an oral hearing according to the pro-, 
cedure for administrative disputes. 

In appropriate cases the provisions of section 58 of the law on the 
general national administration of July 30, 1883 (Law Coll., p. 195), 
shall be applicable to the effect that even when the city of Berlin is 
concerned the minister of the interior shall designate the district 
committee which is to decide the matter. 

(4) Distribution of the Amount of Taxes Required Among the Various Kinds 

OF Taxes. 

Sec. 54. The property taxes assessed by the State shall as a rule be 
drawn upon for the communal tax to an amount at least equal to but 
not exceeding 50 per cent higher than additional charges to the State 
income tax are collected. 

As long as the property taxes do not exceed 100 per cent it shaU be 
permissible to leave the income tax free or to draw upon it to a 
smaller amount than indicated in the first paragraph. 

If more than 150 per cent of the property taxes assessed by the 
State are collected, and if the State income tax is burdened over 50 
per cent, then 2 per cent of the State income tax may be collected 
from the surplus for each per cent of the property taxes assessed by 
the State. 

More than 200 per cent of the property taxes shaU not as a rule be 
collected. 

Sec. 55. Additional charges beyond the full rate of the State income 
tax as well as departures from the provisions contained in section 54 
shall require approval, the departures being permissible only for 
special reasons. 

In both cases the rule should be observed that expenditures of the 
commune which redound to a preponderating degree to the advantage 
of real estate and industry should as a rule be covered by means of 
property taxes, unless there is an equalization according to sections 
4, 9, 10, or 20. Among such expenditures are included particularly 
those for the construction and maintenance of streets and roads and 
drainage and irrigation works, as well as for the payment of interest 
and sinking fund on the debts contracted for these purposes. 



46 TAXING GOVERNMENT PROPERTY. 

Sec. 56. In order to cover the necessary amount of taxes to be 
derived from property taxation, the assessed land, building, and indus- 
trial taxes shall as a rule be drawn upon in equal proportions. 

If, however, the land (house) owners or operators of industries 
enjoy special advantages from institutions of the commune or if they 
cause the commune special expenses, then, unless there is an equaliza- 
tion according to sections 4, 9, 10, or 20, the amount of tax to be 
derived from property taxation (sees. 54 and 55) shall be further 
correspondmgly subdistributed among the real estate and industrial 
property taxes, calculated in per cents of the assessed property taxes; 
provided, however, that land and buildmg taxes shall not be drawn 
upon more than twice as heavily as the industrial taxes, and vice 
versa. 

Exceptions may be allowed by the ministers of the interior and 
finance for special reasons. 

The foregoing provisions shall be appropriately applicable to the 
collection of the land tax in proportion to the building tax. 

The subdistribution (pars. 2 and 4) shaU require approval. 

Sec. 57. In apportioning the amount of tax needed (sees. 54, 55, 
and 56), the proceeds from special communal taxes (sec. 23, par. 2; 
sees. 25, 29, and 37) shall, according to theu' character and arrange- 
ment, be charged to tiie part of the tax needed which is to be raised 
in percentages of the corresponding tax assessed by the State. 

Rent taxes on quarters used for industrial purposes shall be 
charged to the industrial tax. 

Sec. 58. The provisions of sections 54, 56, and 57 shaU not be 
applicable to the industrial tax and to the tax on building lots (sec. 
27, par. 2). Additional charges in connection with the industrial 
tax and exceeding 100 per cent shall require approval. 

Sec. 59. In regard to the distribution of the amount of tax needed 
according to the foregoing provisions (sees. 54 to 57), the commune 
must reach a decision by the end of the first three months of the fiscal 
year. If no valid decision is reached by this time, the property taxes 
shall, for the purpose of covering the amount of tax needed (and 
without prejudice to the provisions of sec. 96, par. 4), be drawn upon 
in a proportion greater by haK than the income tax and in equal per- 
centages as among themselves. Nevertheless the supervisory author- 
ity shall be empowered to order the tax requirements met in accord- 
ance with sections 54 and 55. 

(5) Time Limits Set upon the Liability to Taxation. 

Sec. 60. As far as the communal and State taxes go together and 
no other provision is made, the provisions existing with regard to the 
State tax shall apply as regards the date of beginning and extinction 
of tne liability to taxation. 

Otherwise the following provisions shall prevail with respect to the 
duration of the liability to taxation: 

1. Tlie liability to taxation shall begin: 

(a) As far as it depends on the establishment of a residence or 
headquarters in a commune, on the first day of the month following 
the establishment of tlie residence or headquarters. 

(h) As far as it depends on sojourn in a commune, on the first day 
of the month beginning after the expiration of the period of sojourn 
prescribed. (Sec. 33, par. 4.) 



TAXING GOVERNMENT PROPERTY. 47 

(c) As far as it is based on the ownership of real estate or the carry- 
ing on of commerce or industry, including mining (sec. 33, No. 2; 
sec. 35), on the first day of the month following the acquisition of the 
real estate or the beginning of the business. 

If, in tlie case mentioned under (b), liabiUty to taxation has arisen 
as a result of the expiration of the period of sojourn or of the previous 
estabhshment of residence, the tax must be paid from the first day 
of the montli beginning after the sojourn is completed. 

2. The liability to taxation shall be extinguished: 

(a) Through the death of the taxable party, upon the expiration of 
the month in which the death has occurred. 

(b) Througli abandonment of the residence, headquarters, or 
sojourn, upon the expiration of the month in which the residence, 
headquarters, or sojourn has actually been abandoned, but if no 
notice of the fact has been given to the communal authority up to 
this time, not until the expiration of the following month. 

(c) Through the ahenation of the real estate or the suspension of 
the commerce or industry (including mining) causing the liabihty to 
taxation (sec. 33, No. 2; sec. 35), upon the expiration of the month 
in which the alienation or suspension has taken place. 

(6) Assessment and Collection. 

Sec. 61. The assessment shall be done by the communal council or 
by a special tax committee of the commune. 

The membership and order of business of the tax committees shall 
be determined by resolution of the commune, the provisions of sec- 
tions 50 (par. 3) to 54, inclusive, of the income-tax law of June 24, 
1891, being appropriately applied. 

Sec. 62. The communal council (tax committee) shall be furnished 
upon request, by the competent State authority, such memoranda in 
regard to taxation obtained during the assessment or determination 
of the State taxes as it may need for the assessment. 

For the same purpose the authorities of other communes shall com- 
municate to the communal council (tax committee), upon request, 
information regarding any tax data w^hich they may possess. 

Sec. 63. The rights of the communal council (tax committee) and 
the obligations of the taxpayers may be regulated by the tax ordinance 
in accordance with the following provisions. 

The communal council (tax committee) may, if it has not been able 
to obtain the necessary tax data otherwise (sec. 62), be empowered 
to demand information in this regard from the taxpayers within an 
appropriate period. The demand must be made in each particular 
case by means of a communication to be sent to the taxpayer. 

The obligation to furnish information shall extend only to the 
answering of the questions asked in regard to certain facts. As far 
as it is a question of appraisements, the taxpayers shall be entitled 
but not obliged to give a statement. 

If objection is made to furnishing the ijiformation, the reasons of 
the objection shall be communicated to the taxpayer before the assess- 
ment with the request to make a further declaration on the subject 
within a fixed period. 

The foregoing provisions regarding the taxpayer shall be appropri- 
ately applicable to attorneys and legal representatives of the tax- 
payer. 



48 TAXING GOVERNMENT PROPERTY. 

Sec. 64. It may be provided in a tax ordinance tliat the assessment 
of certain property taxes is to take place for several successive fiscal 
yeai's. Unless provision is made in this respect, the assessment shall 
be each time for one fiscal year. 

Sec. 65. In case of collection of percentages of tlie ))roperty tax 
assessed by the State, or of additional charges to the State income 
tax, the communal council shall publisli the taxes, in the case of 
those tax])a3^ers in regard to whom the tax assessed by the State 
forms the unchanged basis for the percentages or additional charges, 
by pubUshing in tlie usual local manner the percentages to be col- 
lected, and in the case of other taxpayers by means of a special com- 
munication. 

TVlien special communal taxes are collected, the publication shall 
be made by the communal council, in tlie case of th.e natural taxable 
persons living in the communal district by displaying for two weeks 
the tax list at places in the communal district to be made known in 
the usual manner, and in the case of the remaining taxpayers by 
means of a special communication. 

When there are accessions during the course of the year there must 
always be a special communication. 

Instead of publication by means of display a special communication 
to each individual taxpayer may be ordered by resolution of the com- 
mune. 

Sec. 66. After the publication has been made (sec. 65) the taxes 
shall be paid during the first eight days of each month. Instead of a 
month, a two or three monthly collection period may be ordered by 
resolution of the commune. Even special days of collection may be 
designated by resolution of the commune. 

If the percentages of the property taxes assessed by the State or 
tlie additional charges to the income tax do not exceed 50 per cent, 
the collection of the tax may be ordered by resolution of tlie commune 
in semiannual amounts or even in the amount of a whole year, the 
collection period being fixed. 

Tlie tax])ayer shall always be permitted to pay several installments 
up to the full yearly amount in advance. 

Sec. 67. The communes ma}' collect from the company itseK the 
communal income taxes payable by the members of a limited-Hability 
company according to section 33, Nos. 2 and 3. 

Fourth title. — Services in Mnd. 

Sec. 68. The taxpayers may be required by resolution of the com- 
mune to ])erform services in kind (manual labor and work with 
teams). 

Work with teams shall be performed by real estate owners accord- 
ing to the number of draft animals required for the management of 
their landed property situated within the communal district, manual 
labor being performed by all taxj^ayers alike. Whether and to what 
extent the amount of manual labor to be performed by landowners 
keeping teams is to be proportioned to the services rendered by them 
with teams, shall be determined either by agreements reached in 
this regard or by traditional custom. In case of doubt it shaP be 
presumed that landowners with teams are to be exempted from 
manual labor only in work where teams are also used. Deviations 



TAXING GOVERNMENT PROPERTY. 49 

from these regulations, esj)ecially the obhgation of other taxpayers 
keeping teams to perform team service, shall require approval. 

Except in emergencies, the services may be performed by compe- 
tent substitutes. 

The commune may allow an appropriate money contribution to be 
paid instead of the service in kind. 

Taxpayers wholly or partially exempted from communal taxes 
according to section 38 of this law may be obliged to perform service 
in kind according to the provision of parr graph 2. 

The persons mentioned in sections 40, 41, and 42 shall be exempt 
from ser^aces in kind unless the latter exist as a lien on their real 
estate ; and tne lower church servants shall be exempt in so far as this 
exemption has been validly due them since. 

Fifth title. — Legal remedies. 

Sec. 69. Taxpayers shall have a right to file protest against their 
assessment for fees, contributions, taxes, and services in kind. The 
protest must be fded within a period of four weeks before the com- 
munal council. 

The period shall begin: 

1. If the publication has been made by displaying the tax lists, 
on the first day after the expiration of the display period. 

2. If a special communication is prescribed, on the first day after 
the communication has been made. 

3. In all other cases, on the first day after the demand for pay- 
ment or performance. 

Protests shall not be permitted against the State tax rate (sees. 
26, 30, 36, and 38) on wnich the assessment is based, or, in the case 
of special commimal income taxes, against the amount of income 
assessed for the State income tax. 

The foregoing provisions shall be appropriately applicable to pro- 
tests against the assessment of landowners, operators of industries, 
and inhabitants of manor precincts for the public taxes thereof. 

Sec. 70. The communal council shall decide regarding the protest. 

The taxpayer shall have a right to file complaint, according to the 
procedure for administrative disputes, against the decision within a 
period beginning on the first day af fcer receipt of the notice and last- 
ing two weeks. The competent authority in the first instance shall 
be the kreis committee in the case of country communes and the 
district committee in the case of city communes. The communal 
council may appoint a special representative to guard the rights of 
the commune. An appeal for review only shall lie against the 
decision of the district committee. 

Controversies among interested parties regarding their obligation 
(based on public law) to bear the burdens mentioned in section 69, 
paragraph 1, shall be subject to decision according to the procedure 
ror administrative disputes. 

Sec. 71. Regarding the distribution of incomes subject to com- 
munal taxation among a number of communes entitled to collect the 
tax (the commune of residence, of sojourn, of location, or of operation) 
according to the provisions of this law^ (sees. 47 to 51 in connection 
with sees. 33 and 52), the decision shall be reached by the kreis 

S. Doc. 163, 63-1 4 



50 TAXING GOVERNMENT PROPERTY. 

committee, at the instance of the taxpayer, taking as a basis the 
appraisement made by the individual communes ; in so far as the city 
of Berlin or other city communes are involved, the decision shall be 
reached by the district committee after hearing all parties concerned. 

The application of the taxpayer, which is to be presented within a 
period of four weeks from the date of publication of the tax (sec. 
65) on the part of the second or some other tax-claiming commune, 
shall take the place of a protest against assessment for the taxes in 
question in each of the communes concerned (sec. 69). 

The kreis (district) conomittee shall, after examining the matter, 
determine the part of the taxable income corresponding to each com- 
mune and the amount of tax to be paid thereon. 

In appropriate cases the provisions of section 58 of the law on the 
general national administration of July 30, 1883, shall be applicable 
to the effect that even in cases when the city of Berlin is concerned 
the minister of the interior shall designate the district committee 
which is to decide the matter. 

Sec. 72. An application for oral hearing according to the pro- 
cedure for administrative disputes may be filed against the decision 
of the kreis (district) committee within a period of two weeks. In 
cases in which section 58, loc. cit., is applicable, the kreis (district) 
committee competent according to the procedure for administrative 
disputes shall be the one that had been declared competent in view 
of the procedure under which the decision was reached. 

Not only the taxpayer, but every commune to whose claim for 
taxes the decision relates, shall be entitled to apply for an oral hear- 
ing according to the procedure for administrative disputes, and it 
shall be directed against all interested parties whose proportionate 
tax is affected by the claim prosecuted by the complainant. 

Sec. 73. If, during the pendency of proceedings connected with a 
decision or according to the procedure for administrative disputes, 
another claim is raised for payment of communal taxes in view of 
the income to which the proceedings relate, the taxpayer shall be 
obliged, within a period of four weeks from the date of publication 
of the tax claim concerned (sec. 65), to request that it be included 
in the pending proceedings before the authority taking cognizancje of 
the matter. It will then be necessary during these same proceedings 
to resolve or decide also in regard to the tax claim raised subsequently. 

Sec. 74. If, after the case has been legally decided, a further claim 
is raised in view of the income constituting the subject matter of the 
previous proceedings, the foregoing provisions (sees. 71 to 73) shall 
be appropriately applicable, except that the kreis (district) conaniit- 
tee which resolved and decided in the first proceedings shall also be 
competent to try the second case, and that the legally determined 
proportion of tax of the communes involved in the first proceedings 
shall not be changed in the second proceedings, but that in the second 
proceedings it shall merely be decided what amount the tax creditors 
first appearinj^ shall make good to those appearing afterwards, in 
accordiance with the proportionate shares assigned to them by the 
Ifegally valid judgment. 

Sec. 75. The obligation to pay or to perform service shall not be 
postponed by protest or complaint. 

Sec. 76. Against the determination of the total tax rate for an 
industry extending over several communes and not assessed for the 



TAXING GOVERNMENT PROPERTY. 51 

State industrial tax but for the communal industrial tax according 
to section 28, Nos. 2 to 6 (sec. 32), the same legal remedies shaU 
be available as would be appropriate in case the industry were assessed 
for the State industrial tax (sees. 35 to 37 of the industrial-tax law of 
June 24, 1891). 

Similarly, the provisions contained in section 38, loc. cit., in regard 
to the legal remedies shall be applicable also in this case with respect 
to the division of the tax rate into the partial payments due from the 
localities where the industry is operated. 

Sixth title. — Supervision. 

Sec. 77. Subject to the following provisions, the district commit- 
tee in city communes and the kreis committee in country communes 
shall be competent to grant the approvals reserved in this law. 

Against the decision (of the provincial council in the case of city 
and of the district committee in the case of country communes) 
reached in regard to a complaint, the president of this council or 
committee shall, for reasons of public interest, have a right to file a 
further complaint with the minister of the interior and finance. In 
this case the provisions of section 123 of the law on the general 
national administration of July 30, 1883, shall be applicable. 

The approval of communal resolutions by which (a) special direct 
OT indirect communal taxes are originally introduced or changed in 
their principles, (h) deviations from the rules of distribution pre- 
scribed in section 54 are ordered, or (c) additional charges beyond 
the full rate of the State income tax (sec. 55) are ordered, shall 
require the consent of the ministers of the interior and finance. The 
ministers shall be allowed to delegate the granting of their consent 
to the higher ranking supervisory authorities subordinate to them. 

The granting of the approval may be limited to a period of one or 
more years, to be determined in advance. 

Sec. 78. If, at the time when the law goes into force, there are 
ordinances in individual communes regarding the levying of fees, 
contributions, indirect or direct taxes, or services which are contrary 
to the provisions of this law, or if communal resolutions of this kind 
are adopted, the supervisory authority shaU be empowered to order 
them modified or supplemented, stating reasons. 

The supervisory authority shaU have this power if the gradations 
of real estate according to which the tax is reapportioned (sec. 25) 
are no longer suitable as a basis for taxation owing to changes in 
ownership and a request for modification or supplementation has 
been presented by a majority of the taxpayers belonging to the one 
gradation. 

The introduction of new and the increase of existing indirect taxes 
shall not be ordered. 

Against the order issued a complaint may be filed according to the 
procedure for administrative disputes within four weeks after the 
expiration of the period set in the order, the complaint to be filed 
before the district committee in the case of country and before the 
superior administrative courts in the case of city communes. 

If a complaint is not filed within this period, the supervisory au- 
thority shall be empowered to adopt, on the basis of the order issued, 
the necessary rules with a view to collecting the fees, contributions. 



52 TAXING GOVERNMENT PROPERTY. 

indirect or direct taxes, or services. The same shall apply in case the 
complaint has been legally rejected. If the complaint is recognized 
definitely as being valid, the order shall go out of force. 

As far as required by public interest, the kreis committee (in the 
case of country communes) and the district committee (in the case of 
city communes) shall resolve as to the temporary method of collecting 
the taxes until a legal decision has been rendered on a complaint filed. 

Seventh part. — Penalties. 

Sec. 79. He who, with the intent of evading taxes, makes incorrect 
or incomplete statements before a competent authority in answer to 
questions asked him or in substantiating a protest, shall be fined a sum 
equivalent to from 4 to 10 times the amount evaded or intended to 
be evaded; provided that the penalty shall in no case be less than 100 
marks. 

If an incorrect or incomplete statement capable of causing a reduc- 
tion of the tax has been made knowingly but not with an intent to 
evade taxes a penalty ranging from 3 to 100 marks shall be imposed. 

Any person who, having made an incorrect or incomplete state- 
ment, corrects or completes it before a competent authority and pays 
the tax withheld within the period set and before he has been reported 
or an investigation has been begun, shall remain free from punishment. 

Sec. 80. The communal council or the members thereof, the mem- 
bers of the tax committees, and the communal officials participating 
in the assessment shall, if they unauthorizedly reveal the circum- 
stances of a taxpayer as regards his business, his property, or his in- 
come, including particularly the contents of a communication giving 
information (sec. 63) or proceedings had in regard thereto, be punished 
by a fine not exceeding 1,500 marks or imprisonment up to three 
months. 

Prosecution shall be begun only at the instance of the communal 
council or of the taxpayer or his representative. If the offense has 
been committed by the communal council or its members, the super- 
visory authority shall also be entitled to institute proceedings. 

Sec. 81. Fines imposed according to sections 79 and 80 but uncol- 
lec table shaU be converted into terms of imprisonment in accordance 
with the provisions of sections 28 and 29 of the penal code for the 
German Empire as applicable to infractions. 

The investigation and decision regarding the punishable acts men- 
tioned in section 79 shaU be for the court, unless the accused party 
voluntarily pays into the communal treasury the fine provisionally 
fixed by the communal council, together with the costs incident to the 
proceedings, and that withiia the period aimounced to him. 

If the accused party has no residence in Prussia, the court shall 
take cognizance of the matter \vithout any penalty being provisionally 
fixed by the communal council. The same thing shall occur if the 
communal council objects for other reasons to fixing a provisional 
penalty or if the accused party waives this measure. 

In case of violations of the duty to maintain secrecy (sec. 80), only 
penal proceedings before the court shall take place. 

Sec. 82. In the tax ordinances penalties up to 30 marks may be 
fixed against contraventions. 



TAXING GOVERNMENT PROPERTY. 5S 

Tho penalties shall be determined by the communal council and 
when they become legally valid (sec. 459 of the code of penal procedure 
of Feb. 1, 1877, Law Bull., p. 253) they shall be collected according to 
the procedure for administrative disputes. 

Eighth title. — Subsequent collections and statute of limitations . 

Sec. 83. The collection of evaded direct taxes (sec. 79) into the 
communal treasury shall take place in addition to and independently 
of the penalty. 

The obligation to pay taxes subsequently shall be barred by limita- 
tion in 10 years and shall, pass to the heirs, though the period of 
limitation for the latter shall be 5 years and their liability shall ex- 
tend only to the amount of their share of inheritance. The limita- 
tion period shall begin with the expiration of the fiscal year in which 
the evasion occurred. 

It shall be the duty of the communal council to determine the 
amount of taxes to be paid subsequently, and against its resolution 
a protest and complaint according to the procedure for administrative 
disputes shall be permissible in accordance with sections 69 and 70. 

Sec. 84. Taxpayers who, contrary to the provisions of this law or 
of the tax ordinances issued on the basis thereof, have been over- 
looked or have remained tax free upon the assessment of direct com- 
munal taxes without a punishable evasion of the taxes having oc- 
curred (sees. 79 and 83), shall be obliged to pay the amount withheld 
from the communal treasury. This obligation shall extend back over 
the three fiscal years preceding the one in which the taxes were ascer- 
tained to have been withheld. 

The obligation to pay taxes subsequently shall pass tO the heirs, 
but only to the extent of their share of inheritance. 

The assessment of the subsequent tax shall take place uniformly 
for the whole period over which the obligation extends according to 
the provisions of this law or of the tax ordinances concerned. 

Sec. 85. If a subsequent tax for the state is fixed according to the 
provisions of sections 67 and 80 of the income-tax law of June 24, 1891, 
the parties obliged to pay the subsequent tax shall pay the corre- 
sponding additional charges to the commune according to the pro- 
visions governing the matter. 

The additional charges to be paid subsequently shall be determined 
uniformly by the communal council for the whole period over which 
the obligation extends according to the provisions oi this law or of the 
tax ordinances concerned. 

Sec. 86. If, in consequence of the filing of a protest or complaint 
or of an additional assessment (sec. 57 of the income-tax law of June 
24, 1891), an increase has been made in the tax originally assessed by 
the State (sec. 30, par. 2; sec. 36, par. 3), the subsequent claim of the 
commune arising herefrom may only be raised within the period of a 
year, beginning on the date of the final decision regarding tne amount 
of the tax. 

Sec. 87. The right of the communes to subsequently claim other 
communal taxes than direct ones shall, without distinction as to 
whether the tax has failed to be paid at aU or whether only a smaU 
amount thereof has been paid, be restricted (1) in the case of excise 
taxes to the period of one year from the date on which the obligation 



54 TAXING GOVERNMENT PROPERTY. 

to pay began, and (2) in the case of other taxes, dues, and contribu- 
tions (sees. 4 to 11), as well as of costs, to the period of three years 
from the expiration of the year in which the claim arose. 

The subsequent claiming of services in kind shall be restricted to 
the duration of the current fiscal year, and that only provided the 
subsequent performance is still possible according to the purposes of 
the service to be performed. 

Sec. 88. Communal taxes and costs presented for collection and 
which have remained in arrears or have had the period of their pay- 
ment extended shall be barred by limitation in four years from the 
expiration of the year in which the payment period falls. 

The limitation shall be interrupted by a demand for payment pre- 
sented to the taxpayer, by an order of distraint, or by respite allowed 
for payment. 

Upon the expiration of the year in which the last demand was pre- 
sented, the distraint was ordered, or the respite allowed expired a new 
limitation period shall begin. 

Ninth part. — Costs and compulsory collection. 

Sec. 89. The costs of assessment and collection of taxes shall be 
borne by the communal treasury unless otherwise provided by section 
14 of the law for the abolition of direct State taxes. However, the costs 
incident to the gathering of information in connection with a protest 
shall be paid by the taxpayer if his statements are found to be incor- 
rect in essential points. These costs shall be specified in the decision 
regarding the protest. 

Sec. 90. Dues, contributions, taxes, and costs, as well as the charges 
collected according to a schedule determined by the supervisory 
authority (charges for use of waters, etc., at health resorts and the 
like) , may be collected by the application of administrative coercive 
measures according to the ordinance of September 7, 1879. (Law 
CoU., p. 591.) 

If services in kind are to be performed, the communal council shall 
be authorized, if the parties liable are delinquent, to have the serv- 
ices performed by third parties and to collect the expenses incurred 
from the former by administrative coercive means. 

Part II. — Kjreis and Provincial Taxes. 

Sec. 91. The existing regulations on the collection of Kreis and 
provincial taxes shall remain intact, with the following exceptions: 

1. Country communes as well as cities shall reserve the right to 
decide as to the manner in which their shares of the kreis taxes are to 
be collected. 

2. In distributing the kreis taxes the land, building, and industrial 
tax of classes I and II shall, as a rule, be drawn upon m the same pro- 
portion as the state income tax is assessed. 

With the approval of the district committee, the amount to which 
the property taxes are to be drawn upon may be increased to one and 
one-half times said proportion or reduced to one-half thereof. 

The resolutions of the kreis diets and district committees necessary 
in order that the foregoing provisions may be carried out may be 
adopted within one year of the date on which the present law goes 
into force. On the date mentioned measures for the distribution of 



TAXING GOVERNMENT PROPERTY. 55 

the kreis taxes which are contrary to the provisions of this law or 
which have not received the approval required thereby shall go out 
of force. 

3. The increased or decreased assessment of individual parts of 
kreise with kreis taxes and of individual kreise with provincial taxes 
may also take place according to a different standard than quotas of 
the kreis or State taxes. 

4. As far as corporations, companies, etc., are obliged to pay income 
taxes assessed in kreise or provmces or as far as natural persons are 
obliged to pay such taxes in different kreise or provinces, the pro- 
visions of this law which relate to the communal income tax shall be 
appropriately applicable in assessing the taxable parties. 

An mcrease or reduction of the state tax rates taken as a basis for 
the distribution of the kreis and provincial taxes as a result of the 
filing of a complaint or protest shall involve a corresponding modifi- 
cation of the assessment for the kreis or provincial taxes. 

Sec. 92. The provisions of sections 51 and 71 to 74 shall be appro- 
priately applicable in kreis and provincial taxation with the following 
exceptions : 

1. The district committee shall decide regarding the distribution 
of an income subject to taxation in several kreise (city or country 
kreise) . 

Instead of a period of four weeks there shall be one of two months. 

2. Regarding the distribution of an income subject to taxation 
in several provinces the provincial council designated by the minister 
of the interior shall decide, even if the city of Berlin is concerned in 
the matter. 

A complaint may be filled within two weeks against the decision 
before the superior administrative court. 

Sec. 93. The kreise shall be authorized to tax the keeping of dogs. 
The tax shall not exceed 5 marks a year for each dog. It shall be 
regulated by a tax ordinance. The tax ordinance shall require the 
approval of the district committee. 

The collection of a dog tax by the kreise shall not affect the right 
of the communes to tax dogs. (Sec. 16.) 

FINAL, EXECUTIVE^ AND TRANSITORY PROVISIONS. 

Sec. 94. All the periods fixed in the present law are exclusive 
periods. Unless otherwise provided in this law, the periods shaU begin 
from the date of presentation of the resolution or other order. The 
date of presentation shall not be counted. Otherwise, the laws on 
civil procedure shall govern with respect to the beginning and 
calculation of the periods. 

Sec. 95. The fiscal year for the commune shaU begin on April 1 
and end on March 3 1 . 

The communal authorities shall have a right to adopt a resolution 
designating a period of two or three fiscal years instead of a fiscal 
year. 

Sec. 96. The present law shall go into force simultaneously with 
the law abolishing direct state taxes. 

The communes shall be obliged to bring all ordinances, b}^-laws, 
regulations, communal resolutions, etc., regarding the collection of 
fees, contributions, indirect or direct taxes, or services into harmony 
with the provisions of this law. 



56 TAXING GOVERNMENT PROPERTY. 

For this purpose the communal resolutions necessary for the 
enforcement of the present law may be drafted in advance and within 
one year before the date on which it goes into force, and the or.li- 
nances and decisions of the administrative authorities and authorities 
of the administrative court may be enacted in accordance with the 
provisions of this law. 

Ordinances which have been in force up to the date on which the 
present law goes into force shall, without prejudice to the provisions 
of section 23, paragraph 4, and section 37, paragraph 2, continue to 
stand until amended by a legally valid resolution of the commune or 
order of the supervisory authority. (Sec. 78.) 

Upon the present law going into force, all provisions of laws contrary 
thereto shall cease to be in force. 

Wherever reference is made in laws to those provisions, the pro- 
visions of the present law shall be appropriately applicable. 

The provisions relating to the collection of Biirgerrechtsgelder 
(money paid for the rights of a city), j inkaufsgelJer (purchase or 
entrance money), and similar charges shall remain intact. 

Sec. 97. The ministers of the interior and finance are charged with 
the enforcement of this law. 

Witness our signature and royal seal affixed. 

Given at the New Palace, July 14, 1893. 

[seal.] William. 

Ct. zu J .ulenburg. 

V. BOETTICHER. 
V. SCHELLING. 

Bar. V. Berlepsch. 
Ct. V. Caprivi. 

MlQUEL. 

V. Kalterborn. 
V. Heyden. 
Thielen. 

BOSSE. 



Paris, June 2, 1913. 
The Secretary of State, 

Washington, D. C. 

Sir: In reply to the department's circular instruction of February 
20 last, in regard to the taxation of Government property, I have the 
honor to transmit Jicrewith a copy and translation (in duplicate) of 
a note from the foreign office in reply to an inquiry I addressed it 
upon receipt of the said instructiojn. 

From tliis reply it will be seen that ordinary Government propertv 
whicli produces no revenue is subject to taxes for services rendered, 
such as removal of garbage, street cleaning, and sewer taxes. 

Property belonging to the State which produces revenue is liable 
to land tax (law of Dec. 31, 1900), but pays only such proportion as 
is due the Department and commune. It also pays those taxes 
which are mentioned above for the nonrevenue producing properties, 
besides certain taxes which the city of Paris is authorized to levy, 
such as the tax on the capital value of properties. This tax can not 
exceed the rate of 10 per cent of the capital value. The land tax is 
assessed at the rate of 2 J per cent of the net income produced by the 
property. 

I have, etc., Myron T. Herrick. 



TAXING GOVERNMENT PROPERTY. 57 

[Translation.] 

French Republic, 
Ministry for Foreign Affairs, 

Paris, May 23, 1913. 

Mr. Ambassador: By a letter dated March 11 last your excellency 
expressed the desire to obtain for the Senate of the United States 
information, as complete as possible, regarding the taxes to which 
the property belonging to the French Government is liable in Paris. 

The minister of finance, to whom I had transmitted your request, 
begs me to inform you that the State properties pay, w^hen they are 
liable to the land tax — that is to say, if they are revenue producing — 
the departmental and communal parts of the tax, which are addi- 
tional to the principal of this tax. 

Except for these fractional parts, there does not exist at Paris any 
departmental tax affecting directly the property of the State. 

On the other hand, the city of Paris has been 'authorized to levy a 
certain number of municipal taxes, which are apphcable to the prop- 
erties of the State under the following conditions: 

When a building belonging to the State is revenue producing, it 
pays all the taxes which affect private buildings, namely, land tax, 
tax for the removal of garbage, tax on the capital value of properties 
built up and not built up, tax for sweeping, tax for draining direct 
to the sewer, tax for draining to the sewer by filtering apparatus, 
tax for cleaning the private branches of a sewer. 

When, on the contrary, the Government properties are nonpro- 
ductive of revenue, they are only liable to the taxes destined to 
remunerate in some way a service rendered; that is to say, taxes for 
sweeping, draining direct to the sewer, draining to the sewers by 
filtermg apparatus, and the cleaning of the different branches of a 
sewer. 

You will find inclosed a certain number of documents (text of laws, 
decree) relating to the municipal taxes apphcable in Paris to the 
Government properties, and which, by their number and exactness, 
seem to be of a nature to satisfy the high assembly of the United 
States. 

For the minister and by authorization. 

Paleologue, 
State Councilor, Minister Plenipotentiary, Director. 

Mr. Myron Herrick, 

Ambassador of the United States at Paris. 



[Translation.] 



(SPECIAL) REAL ESTATE TAX (TAXE FONCIERE) AND TAX FOR THE 
REMOVAL OF GARBAGE. 

[Law of Dec. 31, 1900.] 

Art. 2. The special real-estate tax (taxe fonciere) is fixed at 2.50 
per cent of the net revenue w^hich serves as a basis for the general 
real-estate tax (contribution fonciere), accordmg to article 2 of the 
law of July 13, 1900. 

It is levied in the name of the owners or usufructuaries. 



58 TAXING GOVERNMENT PROPERTY. 

It is due not only from built-up property subject to the general real- 
estate tax but also from that which is temporarily exempted there- 
from by application of article 9 of the law of August 8, 1890, and 
article 9 of the law of November 30, 1894. 

No reduction shall be granted on account of vacancy of a house or 
idleness of a factory. 

Art. 5. The tax for the removal of garbage shall be levied on all 
property subject to the special realty tax, with the exception of 
factories and houses or parts thereof rented for a public service; it 
is fixed at 1.0666 per cent of the net revenue serving as a basis for the 
special realty tax after deducting the net revenue coming from those 
dwelling quarters having an actual rental value under 500 francs which 
are not subject to the general realty tax. 

The tax for the removal of garbage shall be levied in the name of 
the owners or usufructuaries and shall be exigible from them and 
their principal tenants, they being allowed recourse against the 
private renters for the reimbursement of the part of the tax arishig 
from the quarters occupied by the latter. 

In case of vacancy, during at least three months, of quarters of 
which the owner does not habitually reserve to himself the enjoy- 
ment, it (the tax for the removal of garbage) may be remitted. 

Officials and civilian or military employees lodged free of charge 
in buildings belonging to the Government or to the department, to 
the commune, or to a public establishment shall be subject nomina- 
tively to a tax for the removal of garbage; the tax shall be calculated 
on the basis of three-fourths the actual rental value of the parts of 
these buildings assigned as their personal dwelling. 



TAX ON THE VALUE IN CAPITAL OF PROPERTY BUILT UP AND NOT 

BUILT UP. 

[LawofJuIy 10, 1902.] 

Art. 1. On and after January 1, 1902, in accordance with article 
5 of the law of December 29, 1897, the city of Paris shall be authorized 
to levy a tax on the value in capital of built-up property situated 
within its territory. 

This tax shall not exceed 0.10 per cent of the value in capital, as 
shown by the appraisement made in pursuance of the deliberations 
of the municipal council of October 21, 1898, and June 25, 1899, 
including, in the case of factories, the value of the equipment which 
is subject to the general realty tax. 

It shall be levied in the name of the owners or usufructuaries. 

It shaU be due, both in the case of unbuilt property subject to 
the realty tax and of built-up property subject to the general realty 
tax and Ln the case of that which is temporarily exempted there- 
from, in pursuance of article 9 of the law of August 8, 1890, and 
article 9 of the law of November 30, 1894. 

However, property belonging to the city of Paris, to the depart- 
ment of the Seine, and to the department of pubUc charity shall be 
exempt from the tax. 

No reduction shall be allowed on account of vacancy of a house or 
idleness of a factory. 



TAXING GOVERNMENT PROPERTY. 59 

The owners shall be permitted to protest agamst the appraisement 
of the value in capital assigned to their real estate within six months 
from the date of publication of the first list in which the property 
has been assessed and within three months from the date of publica- 
tion of the lists of the two following years, in accordance with article 
18 of the law of July 10, 1901. 

After this period has elapsed no protest shall be received except in 
the case of the total or partial demolition of the houses or factories 
and in case the realty should cease to be subject to the general 
realty tax. 

New buildings, reconstructions, and, generally speaking, all property 
which may become subject to taxation shall be assessed in comparison 
with the other property of the same character already taxed. 

The appraisements of the value in capital of property which is or 
not built up shall be revised at the same time as the appraisements 
of the net revenue serving as a basis for the general realty tax on 
built-up lands, they may be contested under the same conditions 
and within the same periods as the original appraisements. 



TAX FOR SWEEPING. 

[Law of Mar. 26, 1873,[ 

Art. 1. On and after the date of promulgation of the present law 
the duty devolving upon the owners of land situated along the streets 
of Paris open to public travel to sweep, according to their frontage, 
a breadth equal to half that of the street, though not to exceed 6 
meters, is hereby converted into a compulsory municipal tax, payable 
in cash, according to a schedule adopted by the municipal council 
after investigation and approved by a decree issued in the form of the 
regulations on public administration, which schedule is to be revised 
every five years. 

In levying the tax no account shall be taken of the value of the prop- 
erty but only of the needs of traffic, of health, and of the cleanness 
of the public thoroughfare. 

The total tax shall not, however, exceed the expenses caused the 
city of Paris by the sweeping of the area charged against the 
inhabitants. 

This tax shall be collected the same as the general realty tax. 



TAX FOR SWEEPING. 

[Decree of Nov. 26, 1909.] 

Art. 1, * * * Highways open to travel shall continue to be 
divided into eight categories. * * * 

The dues to be collected for each category shall be according to 
the following schedule : 

Buildings bordering on the public highway: First category, 78 
centimes per square meter; second category, 67 centimes per square 
meter; third category, 56 centimes per square meter; fourth cate- 
gory, 44 centimes per square meter; fifth category, 33 centimes per 
square meter; sixth category, 22 centimes per square meter; seventh 



6Q TAXING GOVERNMENT PROPERTY. 

category, 11 centimes per square meter; eighth category, 9 centimes 
per square meter. 

Built-up property not bordering on the public highway and inclosed 
by walls, fences, or other equivalent inclosures: First category, 58 
centimes per square meter; second category, 50 centimes per square 
meter; third category, 42 centimes per square meter; fourth category, 
33 centimes per square meter; fifth category, 25 centimes per square 
meter; sixth category, 17 centimes per square meter; seventh 
category, 8 centimes per square meter; eighth category, 7 centimes 
per square meter. 

Vacant lots inclosed with picket fences, trellis work, hedges, or unin- 
closed: First category, 39 centimes per square meter; second category, 
33 centimes per square meter; third category 28 centimes per square 
meter; fourth category, 22 centimes per square meter; fifth category, 
17 centimes per square meter; sixth category, 11 centimes per 
sc[uare meter; seventh category, 5 centimes per square meter; 
eighth category, 4 centimes per square meter. 



TAX FOR DIRECT CONNECTION WITH SEWER. 

[Decree of July 10, 1894.] 

Art. 3. The city of Paris is authorized to collect from the owners 
of buildings situated along streets provided with sewers, for the 
direct evacuation of water-closets, an annual sewer tax to be assessed 
on the net revenue from the property according to the following 
schedule: 10 francs for a house yielding a revenue, assessed for the 
general realty tax or the tax on doors and windows, amounting to 
less than 500 francs; 30 francs for a house yielding a taxed revenue 
of 500 to 1,499 francs; 60 francs for a house yielding a taxed revenue 
of 1,500 to 2,999 francs; 80 francs for a house yielding a taxed 
revenue of 3,000 to 5,999 francs; 100 francs for a house yielding a 
taxed revenue of 6,000 to 9,999 francs; 150 francs for a house yielding 
a taxed revenue of 10,000 to 19,999 francs; 200 francs for a house 
yielding a taxed revenue of 20,000 to 29,999 francs; 350 francs for a 
house yielding a taxed revenue of 30,000 to 39,999 francs; 500 francs 
for a house yielding a taxed revenue of 40,000 to 49,999 francs; 750 
francs for a house yielding a taxed revenue of 50,000 to 69,999 
francs; 1,000 francs for a house yielding a taxed revenue of 70,000 to 
99,999 francs; 1,500 francs for a house yielding a taxed revenue of 
100,000 francs and above. 

As regards premises which are exempted for one reason or another 
from the general realty tax on built-up property, the city may 
collect a fLxed tax of 50 francs per drain. 

The proceeds from these taxes shall serve to pay back the loan, 
including principal and interest, and to meet the increase in expenses 
of maintenance. 



TAXING GOVEKNMENT PROPERTY. 61 

TAX FOR DRAINAGE INTO SEWER BY MEANS OF FILTERING 

APPARATUS. 

[I'refectural decision of July 17, 1907.) 

Art. 1. The owners of houses bordering on the public highways 
provided with a sewer, but where direct drainage is not yet applied, 
may be provisionally authorized to have the liquid sewage from 
said houses drained off into the sewers of the city of Paris by means 
of filtering apparatus 

Art. 6. The owner or a representative in his name shall pay into 
the treasury of the collector of taxes of the quarter in which the 
house is situated an annual tax of 30 francs per drainpipe. 



TAX FOR CLEANING PRIVATE BRANCHES OF SEWERS. 
[Prefectural decision of Mar. 10, 1906.] 

Art. 1. Private branches of sewers may be cleaned by the munici- 
pal administration at the expense of the owners. 

Art. 5. The tax to be paid by the commissioner shall be regulated 
* * * in accordance with the following schedule: 

For each gallery of a length of 2.50 meters at most, 5 francs per 
year. 

Rate per meter in length above 2.50 meters, 2 francs. 

Every fraction of a meter shall be counted as a full meter. 



Embassy of the United States, 

Vienna, July 8, 1913. 
The Secretary of State, 

Washington. 
Sir: In response to the department's circular instruction of Febru- 
ary 20, 1913, entitled '' Taxation of Government property," I have 
the honor to inclose a copy and translation of a report on this subject 
as received from the imperial and royal ministry of finance. 
I have, etc. 

U. Grant-Smith, 
Charge d^ Affaires ad interim. 



[Translation,] 

American Embassy, 
Vienna, June 12, 1913. 

Referring to the subject submitted by the esteemed embassy, 
requesting iaformation as to the legal provisions for taxation of 
Government property in Austria, the I. and R. ministry of finance 
has the honor to state as follows : 

For financial purposes of the State, taxation of Government prop- 
erty is a formality, in so far as, serving as an example, the taxation 
of a Government enterprise is a charge of the budget against the 
enterprise in question, merely figuring as an item of receipts in the 
financial accounts. 



62 TAXING GOVERNMENT PROPERTY. 

As a matter of fact the significance of the taxation of State property 
in Austria is to be found in the province of the additional taxation 
levied by independent bodies, such as communal administrations of 
greater or lesser magnitude (crownlands, precincts, municipalities). 

In general the system of taxation of these independent bodies is 
not based upon their independent levies but upon a proportional 
addition to the State taxes, and thus the levy of a State tax on State 
property enables such State property to be made the subject of 
taxation in favor of the aforesaid independent bodies. 

An important feature in this particular respect is the State tax 
levy of the State-owned railways in which the additions to this tax 
are of great importance to the household expenses of many com- 
munities. 

As to individual provisions regarding taxation of State property, 
the following brief description may serve as information: 

(1) Real 'property. — Real property of the State is subject to the 
same taxation as privately owned real property, provided such prop- 
erty be not exempt from taxation by tne law of May 24, 1869, puD- 
lished in the Government Gazette No. 88, regulating exemption from 
ground taxation, as, for instance, the character of real property when 
a public highway. (Pars. 1 and 2.) 

(2) Buildings. — ^As to the provisions of the building laws relating 
to buildings belonging to the State, the following aspects must be 
considered : 

State buildings are structures the direct property of the State used 
for any State purpose or public use, i. e., serving for purposes of pub- 
lic administration, as defiAed in paragraph 23, letter (o) oi the instruc- 
tions in ascertaining rents collected, law of June 26, 1820, Z. 918, and 
which are exempt from building taxation by virtue of paragraph 2 
of the building tax patent of February 23, 1820, in so far and for 
such time as such buildings do not bring in rents by letting. (Decree 
of the court of chancery of Oct. 6, 1835, Z. 3561.) Such, for instance, 
as courthouses, buildings used by the judiciary, by the civil and 
financial administrations (including buildings for the administration 
of State monopolies in tobacco, salt lottery), the administration of 
public education, schoolhouses, postal buildings, etc., are regarded as 
permanently tax free. 

In the same category fall also the buildings of the State-owned rail- 
ways (station buildings, guardsmen's buildings, etc.) (decree of the 
director general of the land registry of Apr. 10, 1857, Z. 6809), military 
barracks, either State or provincial property, for the use of which 
neither rent nor any other compensation is received. (Par. 2 of the 
building tax patent, decree of the court of chancery of Feb. 10, 1835; 
see also par. 23, letter (c) of the instructions in the ascertainment of 
rents collected, of June 26, 1820, Z. 918.) 

Furthermore, such buildings as are occupied by the State in lease- 
hold, treated under the general laws pertaining to buildings and sub- 
ject to house taxation. (See decree of the court of chancery of Oct. 
30, 1846, Z. 34080, and of Nov. 21, 1820, Z. 2001.) 

(3) The State is subject to taxation on incomes derived from busi- 
ness enterprises undertaken for profit when in competition with pri- 
vate enterprises. (The tax in such cases amounts to 10 per cent of 
the proceeds ascertained for the purpose of taxation; when the pro- 
ceeds turn out to be too small, to 1 per mille of the capital therein 



TAXING GOVERNMENT PROPERTY. 63 

invested.) (See II principal chapter of the law of Oct. 25, 1896, pub- 
lished in the Government Gazette, No. 220.) 

Enterprises of the State, on the other hand, undertaken by virtue 
of State supremacy rights, or for purposes of public administration, 
are not subject to taxation. To this category belong the enterprises 
of the State monopolies, consisting in the tobacco factories, salt works, 
the court and State printing office, the mails, the telegraph service, the 
production of vaccine, clinics, hospitals, etc. (See par. 3 of the law 
of Oct. 25, 1896, published in the Government Gazette, No. 220, and 
articles 1-7 of the rules of procedure II, published in the Government 
Gazette, No. 124, ex 1897.) 

By virtue of distinct legal provisions (par. 83, personal-income tax 
II, principal provision), the State-owned railways and the State- 
owned navigation companies, the latter being those upon the Lake of 
Constance (Bodensee) are subject to taxation. 

(4) The State and the Crown lands are exempt from the payment 
of taxes on annuities unless such taxes shall have previously been 
deducted by the pajring tellers of the competent treasuries in com- 
pliance with the personal- tax laws. (Par. 125, Z. 1.) 

(5) Within the scope of dues and similar in character to a tax is the 
"Gebiihrenequivalent," ^ which corporations have to pay to the 
State as compensation for the loss of such dues as real, and under 
certain conditions personal, property owned for a period of 10 years 
are liable for. (Tariff item 106 B e of the laws of Dec. 13, 1862, pub- 
lished in the Government gazette, No. 89.) 

The State, public authorities and oflSces, public institutions sub- 
sidized by the State treasuries and their representatives, as well as 
State funds, are exempt from the payment of ' ' Gebiihrenequivalent" 
when the obhgation to pay these dues does not fall upon the ex- 
chequer or upon Government bonds. On the other hand, deeds, 
records, documents, and official transactions are subject to the pay- 
ment of such dues, while property is not. 

Bareck. 



American Embassy, 

London, July I4, 1913, 
The Secretary of State, 

Wasliington. 
Sir: Pursuant to the instructions contained in the department's 
^circular of February 20 last, I have the honor to transmit herewith 
inclosed a copy of a memorandum I have just received from the 
foreign office giving a report upon the system pursued by the British 
•Government in taxing Government property in London. 
I have, etc., 

Walter Hines Page. 



1 For this word there is no English equivalent. 



64 TAXING GOVERNMENT PROPERTY. 

[Memorandum.] 
TAXATION OF GOVERNMENT PROPERTY IN LONDON. 

(1) General taxation. — With regard to general taxation (i. e., tax- 
ation levied by the State) Government property is charged to property 
tax (income tax schedule A) only when it is let, in which case the 
occupiers are assessed to the duty, and are expressly authorized to 
deduct the duty on payment of the rent, or when it is occupied rent- 
free by officials as part of their remuneration, in which case the 
occupier is assessed to and charged with the duty. The exclusive 
use and occupation of a Government house by such an oflPicial also 
involves Uability on his part to inhabited house duty. 

The liability of army and navy officers in respect of the quarters 
occupied by them depends upon the nature of their appointments, 
the assessment of the duty being restricted to those cases in which 
the appointments are for a fixed, or practically fixed, term and no 
charge being made in cases where the appointments are of such a 
nature as to render the officers liable to instant and frequent removal. 

No land tax is paid on Government property. 

(2) Local taxation. — The Crown is exempt at law from all '^ rates" 
(the technical name for local taxes) in the United Kingdom, but con- 
tributions in lieu of rates are granted ex gratia b}^ His Majesty's 
Government to local authorities in respect of properties in the occu- 
pation of the Crown for the public service. The amount of the grant 
IS fixed on a basis which corresponds generally to that taken for com- 
parable ratable properties. This valuation basis is fixed by the 
treasury in all cases and not by the local authorities themselves, and 
the contributions are made directly by the treasur}' to the authorities 
concerned. 

The contributions are purely Crown bounty, and the principle on 
which they are given is that a locality should not suffer a loss in 
revenue by reason of the Crown occupation of an area which would 
otherwise be ratable, or of property previously ratable which has 
become nonratable because it has been acquired or occupied by the 
Crown for the public service. The contributions are confined to 
premises which are provided and maintained out of the votes of 
Parliament, but no contributions are given in respect of property in 
the personal occupation of the sovereign. 

The basis of local taxation is one of annual value. 

o 



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